Boeing: Last Week Tonight with John Oliver (HBO)

our main story tonight concerns

airplanes the place you go to say I'll

get some reading done before watching

Nine episodes of The Office you've

already seen and landing in Tucson

planes make many of us nervous even

though commercial air travel is the

safest form of mass transportation but

accidents do happen and there was one

recently that got a lot of attention

passengers are sharing their terrifying

experience on board an Alaskan Airlines

plane that lost a door plug during

flights what was supposed to be a short

trip from Portland to Ontario California

for Garrett Cunningham turned out to be

one of the most frightening experiences

of his life a gush of of air I look to

my left and part of the plane is gone my

brain couldn't compute what I was

looking at yeah of course it couldn't

our minds filter out things that

shouldn't make sense mine for instance

refuses to acknowledge that tomatoes are

fruits or that the shoe Bill isn't

extinct does that really look like

something that should exist at the same

time as the iPad I think not now

thankfully that flight landed safely

with only a few injuries but experts say

that that was mostly luck for one thing

if someone had been sitting in the

window seat with their seat belt off

they could have been sucked out of the

plane and second this happened just

after takeoff but if they'd been at

cruising altitude injuries might have

been catastrophic and that plane was

almost new it had been delivered by the

manufacturer Boeing around 2 months

earlier and that's too soon for a

sneaker to fall apart let alone a

multi-million dollar aircraft now Boeing

CEO Dave Calhoun was quick to take

responsibility saying Boeing is

accountable but when pressed on exactly

what had taken place had an odd response

how did an unsafe airplane fly in the

first

place because a quality Escape

occurred can you qu Escape occur what is

a quality

Escape I think that's the description of

what people are finding in their

inspections um uh anything that could

potentially contribute to an accident

what quality didn't escape a part of the

plane did that's a terrible answer when

you asked how an unsafe plane flew in

the first place we need more information

than essentially the plane was unsafe

yeah everybody knows that there's a

hole in the side of it and the

exact nature of the Escape is pretty

alarming given that according to the

preliminary investigation four bolts

that were supposed to keep the door plug

in place were missing and when Alaska

checked their other max9 planes they

found loose bolts on many of them the

next day the FAA announced that every

Boeing 7379 Max with a plug door would

be grounded until they were inspected

which is a bit of a relief and honestly

kind of a fun image i' like to imagine

Stern FAA inspectors going up to each

plane and saying you are grounded Missy

no inflight TV for a month and yes

planes are girls cuz think about it they

always have snacks and constantly say

leaving right now and then don't move

for another 15

minutes case closed it's beginning to

feel like this might be a much broader

issue within Boeing because it comes on

the heels of a years long string of

alarming incidents from fires on board

to a pair of massive crashes that were

blamed on flawed Boeing planes and just

this week the FAA issued a stunning

order to the company the Federal

Aviation Administration gave Boeing 90

days now to come up with a plan to

address safety issues this comes after a

report released on Monday found

employees did not understand their role

in safety and they feared retaliation

for raising safety related concerns uh

those are big problems when you've got a

factory that is making Jets yeah of

course although to be fair workers being

unable to raise safety concerns is a big

problem in a factory that makes anything

no one wants grocery stores selling

Captain Crunch oops all rat poison and

all of this is striking for a company

that genuinely used to be seen as one of

the greatest in America and that's still

one of the country's largest exporters

so if a company this big and this

important seems to be this troubled

tonight let's talk about Boeing and

let's start with the fact the Boeing

used to be synonymous with quality and

craftsmanship it was founded by William

Boeing in 1916 and over the years it

built nearly 100,000 planes for the

Allied Forces the first stage of the

Satin five rocket and Air Force One but

they're best known for revolutionizing

commercial aviation in 1967 Boeing

introduced the 737 have made over 10,000

of them since and the company's success

rests heavily on its well-earned

reputation for excellence like in this

video from an annual shareholder meeting

the first step in making a difference is

believing you can we make the impossible

happen on a regular basis so it can be

done you you just have to think of a new

way to do it let's just do it right

whatever it is quality safety

environment do it right and make it

something that you can be proud of I

wanted to develop products that had a

global reach and a global

impact and I'm doing it

[Music]

now I mean that sounds pretty good we do

the impossible great love the impossible

let's just do it right yes let's Wrong

Feels Like a bad way to do it I want to

develop a globally impactful product and

I did good for you you're a little too

close to the camera but in general I am

on board in fact Boe had such a great

reputation for safety among Pilots there

was even a common saying if it ain't Boe

I ain't going which the company put on

T-shirts lanyards and mugs that you can

still buy on their website all perfect

gifts for someone who loves branded

merch and does not love following the

news and that Stellar reputation has

been credited to the company's engineer

centered open culture William Boeing

himself once said after noticing some

shoddy workmanship on his production

line that he would close up shop rather

than send out work of this kind and one

project leader in the 80s and early 90s

is remembered for saying no secrets and

the only thing that will make me rip off

your head and down your neck is

withholding information and I'm sorry

but that should be the mug you want a

shift merch that's how you do it but

it's pretty clear that we're a long way

from that culture today and most

observers will trace the shift back to

this pivotal event a major announcement

today in the world of Aviation Boeing

and McDonald Douglas today announced

they would joined together to form the

world's largest aircraft manufacturer

this is I believe a an historic

moment in aviation and

Aerospace yeah the sky boys got business

married Boeing merged with McDonald

Douglas who were primarily known for

military planes and had a lousy

reputation for commercial airliners most

notably the dc10 which had multiple

accidents resulting in over 1100

passenger fatalities and look was

merging with the McDonald Douglas

Aerospace Manufacturing Corporation SL

murder Emporium that Boeing CEO's worst

decision probably not because he also

and this is true married his first

cousin so the last decision I'd ask this

guy to make is who it's a good idea to

couple up

with and while Boeing was the acquirer

in the partnership it soon became clear

that the McDonald Douglas culture which

was much more Cutthroat and profit

driven was going to become dominant

early on the McDonald Douglas management

team even gave their Boeing counterparts

a plaque featuring an Economist magazine

cover about the challenges of corporate

merges which sounds benign until you see

that the actual cover was this picture

of two camels and McDonald

Douglas exec added the line who's on top

and setting aside the weirdness of

gifting your co-workers camel porn it

begs the the question what was going on

at the economist back

then spare a thought for the employee

who dreamt of doing business journalism

only to find themselves digging through

photos of horned up camel banging

in the

dirt a year after the merger was

finalized boing announced a new stock

buyback program taking company money

that could have gone to making planes

and using it to inflate stock prices

instead and even mechanics at the

company noticed the culture shift there

is a m major campaign launched called

Share value and the idea was that they

wanted everybody to be aware of the

stock price and they wanted everybody

working together to increase the stock

value even the technical meetings

everything revolved around boing stock

prices yeah that's not reassuring

because that's not where you want their

priorities focused no wants to get on a

plane and he good afternoon this is your

captain speaking we had a few technical

problems but our maintenance crew is has

assured us that the stock price is still

holding strong so let's get this big

metal tube full of you and your loved

ones up into the sky shall we and the

culture change was solidified by the

decision to relocate the corporate

headquarters from Seattle where their

commercial planes were actually designed

and built 2,000 miles away to Chicago

because as their CEO put it when the

headquarters is located in proximity to

a principal business the Corporate

Center is inevitably drawn into

day-to-day business operations and yeah

it should be you're essentially saying

hey we're going to be making big

business decisions over here so we don't

need to be bothered with you nerds and

you're keeping planes in the air

now CEO Phil conit soon left

the company amid a Contracting Scandal

and was replaced by Harry Stoner the

former CEO of McDonald Douglas he was an

aggressive Cost Cutter who pushed

boing's management to play tougher with

its Workforce and to introduce the

slogan less family more team which

frankly would have been great advice for

Phil Condit when he was choosing a

romantic partner less Family Phil you

want to be a team but like not one

that's related by

blood but the problems with the whole

stock price first approach soon became

apparent during the production of the

787 Dreamliner it was a new lighter

plane the Boeing announced in 2004 but

Stone Cipher drastically cut the R&D

budget you know the money for creating

the plane even as the company authorized

large stock BuyBacks and dividends for

investors under his plans the Dreamliner

would be de developed for less than half

of what their previous new plane had

cost Bo also sought savings by

Outsourcing production to about 50

suppliers each of whom was responsible

for managing its own subcontractor so

basically the plan was for boing to

create the plane the same way someone

creates a gingerbread house from a kit

essentially assembling a bunch of pieces

other people made leading to a finished

product that structurally speaking was

always going to be a mess and

years later Boeing itself produced a

promotional video that admitted that

plan was a

Fasco executing a project of such

complexity proved to be more than some

suppliers could

handle wrinkles were found in the

composite skins from one supplier

Fasteners were incorrectly secured on

sections of the tail there were gaps

between units that were supposed to fit

tightly together we had our partners and

then they had Partners who had partners

and the different cultures and the

communication uh was very challenging

and added a lot of complexity you know

it's never a great sign when you're

talking about the manufacturing process

for a plane the same way a doomed open

thropple talks about their private life

we had our partners and then they had

Partners who had partners and

communication was very challenging and

added a lot of complexity and long story

short now we all have

chlamidia and on top of that Stone

Cipher was forced to resign in the wake

of an affair with a Boeing VP and was

replaced by the company's third CEO in

as many years Jim McNerney who if

anything accelerated the cost cutting

but despite all the setbacks from

Outsourcing Boeing managed to roll out

the dream liner on time in an elaborate

ceremony in 2007 except there was one

small catch we were all inside the

factory with artificial lighting big

stage Tom brocca huge

screens

then they open the doors of this giant

assembly Bay and en rolls this beautiful

beautiful aircraft we learned that the

whole thing was a

sham beautiful isn't it absolutely

beautiful I realized the doors were made

of plywood this plan that we were

admiring was completely a shell inside

what I realized walking around it is

that you could you know look up in the

wheel well and you could see daylight

wow what a historic moment so exciting

to see the unveiling of the first

airplane made entirely out of plywood

and lies the plane was supposed to take

its first test flight within two months

of that launch but unsurprisingly that

didn't happen in fact the Dreamliner

didn't carry commercial passengers for

years finally delivering planes three

years late and $25 billion over budget

and almost immediately there were

problems multiple planes had fires on

board including two in Boston and Japan

within 9 days of each other which

investigations link to a defective

battery made by a subcontractor that

Boeing had never audited so the FAA

grounded the Dreamliner the first time

it had grounded an airplane model since

the mcdonal Douglas dc10 in 1979 again

making it pretty clear that the wrong

attitude had prevailed after the merger

basically the wrong camel came out on

top and investigations revealed that

even people people building the

Dreamliner were worried about its safety

in 2014 aler released hidden camera

footage of a worker at a Dreamliner

plant asking fellow employees a pretty

pointed question did you fly one um no

you won't fly on

one did you fly on one of these

planes did you fly on one of

these probably not I would one of these

ples you wouldn't why wouldn't you huh

why wouldn't you because I see the

quality vide going down around here did

you fly one of these yeah it's sketchy

sketchy I probably would but I mean I a

death

too it's

true out of 15 workers he asked 10 said

they wouldn't fly on that plane and

honestly that last guy is almost worse

because if I had to pick between a plane

that two-thirds of workers refuse to get

on and one that would only be ridden by

death wish Dave I'd pick the former

every time but while the Dreamliner had

its problems at least it never had a

fatal accident but that cannot be said

for Boeing's next plane the 737 Max in

2011 as Boeing was rolling out the

Dreamliner its main competitor Airbus

was unveiling the A320 Neo a fuel

efficient update of their already

popular A320 planes and it was a wild

success Boeing caught completely off

guard quickly announced a new fuel

efficient plane it hadn't even

engineered yet the 737 Max they wanted

to get it out of the door as quickly and

as cheaply as possible McNerney even had

a catchphrase More For Less which became

the company's driving theme as it

embarked on the Max and all the while

under McNerney and his successor as CEO

Dennis mullenberg boing continued to

sign off on massive stock BuyBacks from

2014 to 2018 Boeing diverted 92% of its

operating cash flow to dividends and

share BuyBacks to benefit investors far

exceeding the money that it spent on R&D

for new planes workers on the production

line for the max described a process

that valued speed over safety and one a

military veteran worried that Corners

were being cut what words would you use

to describe that Factory at that point

dangerous um unnecessary Tak an

unnecessary risk he says he urged the

Boeing manager to shut down the factory

for a few weeks to straighten things out

and what was his reaction to that and he

said um you know we can't shut down and

and then I kind of got mad and said you

know I've seen military operations shut

down for a lot less what was his reply

to that something I'll never forget he

said um he said well the military is not

a profit Mak

organization wow what a response because

in a way you're right the military isn't

a profit-driven culture but they do have

pretty famously a very high appetite for

death and dest ruction so if someone who

worked there is going who slow down a

bit that seems like something that

should give you pause so the max was

rushed through design and production and

with tragic consequences on October 29th

2018 a Lion Air flight Bound for

Indonesia carrying 189 people including

three children disappeared from radar

just minutes after takeoff and was found

to have crashed into the water no one on

board survived investigations later

revealed that the plane's safety had

been compromised by a series of

shortsighted decisions Boeing had made

starting with the fact that to save

money Boeing decided it wasn't going to

build a new plane it was just going to

rapidly modify its existing 737 model

giving it new much bigger engines but

that brought some significant

complications because these engines are

bigger they had to be positioned further

forward and higher up on the wings and

so Boeing was worried about the plane

getting into uh too much of a nose up

and then the plane could

stall so if it starts to pitch up mcast

was designed to help the pilot level the

plane out yeah they added a system

called mcass or maneuvering

characteristics augmentation system very

basically when the plane came close to a

situation in which it might stall mcass

would in technical terms swivel the

horizontal tail fin to lift the tail up

and push the nose down or in

non-technical terms make the go face

down ass up but there was a fatal flaw

mcass which again could push a plane's

nose down on its own could be activated

by a single sensor the angle of AAG

sensors protruded out of either side the

fuselage near the

cockpit if a happy birthday myar balloon

gets stuck on that vein it becomes

unreliable but believe it or not we hit

balloons we hit H Birds uh and all of

these things uh are not

uncommon it's true the whole system

could be compromised by a balloon a

testament to how problematic it is to

use a single sensor and yet another

reason to hate balloons think about it

they're exhausting to inflate they scare

the out of you when they pop and

uninflated they just look like a pile of

clown condoms balloons are terrible but

it gets worse cuz Boeing didn't tell

Pilots about mcass cuz remember they

decided to market the plane 2 Airlines

as a money saver and a massive selling

point was that the max wouldn't require

Pilots to be retrained in a flight

simulator that that's a pretty big

expense for an airline as it takes

Pilots out of the air for multiple days

Boeing was worried that if they

emphasized mcass as something new it

might require more training so it told

Airlines and Regulators that the max was

so similar to the old 737 simulator

training wouldn't be necessary and that

is something even the mother of one of

the Lion Air Pilots whose flight crashed

thought was a bit weird at the time I

said you haven't had a simulator

training how can you go for Max and it

is a more powerful engine so without a

simulator how will you manage he said

mom I've been given round training they

have given me a training on iPad I said

what an iPad that is wild it is bad

enough that iPads are replacing half the

staff at Panera

breit it is worse when they're replacing

practical training for dangerous jobs

Boeing gave Pilots a 2hour iPad training

course that never once mentioned mcass

what's more it wasn't in the manual at

all unless you count the glossery which

defined the term but didn't explain what

it did and it turned out that a faulty

mcast activation was what had doomed

that Lion Air flight and when American

Airlines Pilots met with Boeing

Executives after the crash and angrily

pointed out no no one had been told

about mcast the answer they got was

ridiculous these guys didn't even know

the damn system was on the airplane nor

did anybody else we try not to overload

the crews with information it's

unnecessary I would think that there

would be a priority on putting things

explanations of things that could kill

you

exactly how is information about a

system that could crash the plane

unnecessary it's not all Froot Loops are

the same flavor or identical twins don't

have the same fingerprints or if you

give a mirror to a dolphin they'll

admire their own genitals all of that is

good information but unnecessary for a

pilot to know but we put some software

on the plane that might try and murder

you feels important in the aftermath of

the crash Boeing told us airline pilot

that they'd have a software fix for

mcass ready within about 6 weeks and the

max was allowed to keep flying but they

didn't the only thing they accomplished

in those six weeks were and you're never

going to believe this authoriz ing a

record $20 billion of stock BuyBacks so

clearly they were concerned about safety

specifically the safety of their

stock price and so a little over four

months after the crash while Boeing was

still working on its six week software

fix Ethiopian Airlines flight 302 a 737

maxjet crashed after mcass activated

erroneously again killing everyone on

board and by that point those Pilots

knew what mcass was but they still

weren't able to correct its erroneous

activation in time 3 days later the FAA

finally grounded the max but only after

all these countries had first it was

grounded for almost two years until

Boeing developed ways to make mcass less

error prone and easier to override and a

damning congressional investigation

later revealed internal messages showing

that Boeing knew how dangerous mcass was

throughout the plane's development in

2012 one of Boeing's own test pilots had

failed to recover from mcass activating

in a flight s simulator a situation that

he described as catastrophic and some of

the messages between Boeing Employees

were damning hundreds of emails and

instant messages show employees mocking

the FAA the company and problems with

the airplane one writing this airplane

is designed by clowns who in turn are

supervised by

monkeys that's pretty bad although part

of me wish is that he kept going there

they're designed by clowns who are

supervised by monkeys who report to

caffeinated toddlers who overseen by a

bunch of floppy puppies were monitored

by a wasted bachelorette party whose

boss is just a large inflatable

tubean so at this point you might

reasonbly be asking where the are

The Regulators should the FAA have

caught this before people died and given

that the answer to that is definitely

yes what happened well the agency relied

heavily on Boeing Employees to vouch for

the Maxi safety because they lacked the

ability to effectively analyze much of

what Boeing shared about their new plane

one employee even said he thought a

presentation for Regulators was like

dogs watching TV because they didn't

understand what they were seeing and I

really hope that's not true I hope dogs

do understand what they're watching on

TV otherwise I did those deep Dives on

squirrels breathing out of a up

little nose and poodle anuses for no

reason at all and incredibly much of the

oversight was being done by Boeing

itself for five decades uh manufacturers

like Boeing were allowed to use what

they call FAA designated inspectors

first to certify that the planes were

airworthy in the beginning and then on

the assembly line to inspect each plane

as it went down went down the line

here's the problem those FAA inspectors

were employed by Boeing there's a

conflict of interest there of course

there is Boeing was paying Boeing

Employees to regulate Boeing it's the

most incestuous relationship we've seen

in this story so far which is saying

something cuz remember this guy was

his first cousin