A Boeing 737 Max lands during a test flight in Seattle on Sept. 30, 2020. (Chona Kasinger/Bloomberg, file)

A Boeing 737 Max lands during a test flight in Seattle on Sept. 30, 2020. (Chona Kasinger/Bloomberg, file)

Boeing Max nears return with repair plan cleared by FAA

The company faces extra scrutiny as it works to convince regulators globally that the Max is safe.

By Julie Johnsson, Mary Schlangenstein and Alan Levin / Bloomberg

Boeing jumped after regulators signed off on repairs that would end a temporary grounding of newer 737 Max models, clearing the way for the planemaker to resume deliveries of a jetliner crucial to its financial turnaround.

The planemaker sent two service bulletins to 737 Max operators late Wednesday, providing instructions to repair a flight-deck electrical issue that sidelined 106 Max jets for more than a month — and could affect hundreds of 737 models made since early 2019.

The repair order, approved by the U.S. Federal Aviation Administration, resolves a manufacturing defect that has irritated customers, halted deliveries and thwarted Boeing’s plans to smoothly re-introduce its flagship jetliner after two fatal crashes.

Boeing climbed 2.6% $226.55 at 10:49 a.m. Thursday in New York, the biggest gain on the Dow Jones Industrial Average. Spirit AeroSystems Holdings Inc., which manufactures 737 Max hulls, rose 5.5% to $43.03 after advancing 6.9%, its biggest intraday increase in a month.

Boeing handed over only four Max planes last month, halting deliveries after alerting airlines and lessors April 9 that some cockpit components weren’t properly grounded because of a slight manufacturing change. The issue involves “degraded” electrical connections on a standby power unit, a circuit breaker panel, and the plane’s main instrument display, the FAA said in April.

“After gaining final approvals from the FAA, we have issued service bulletins for the affected fleet,” Boeing said by email. “We’ll continue to stay close to our customers as they complete the work to return their airplanes to service. We are also completing the work as we prepare to resume deliveries.”

The FAA issued an airworthiness directive requiring repairs on April 28 and said it was working with Boeing to finalize the fixes. The costs and time involved are fairly minimal. The repairs should take between nine and 24 hours per plane, for a cumulative tab of about $155,000 for the aircraft sidelined in the U.S. At least some of the expenses may be covered by warranty, the FAA said.

Southwest Airlines estimated that repairs will take two to three days for each of its 32 Max aircraft grounded by the issues. The work, which should begin in the next several days, will take about three weeks to complete, the airline said Thursday.

FAA Administrator Steve Dickson told a congressional committee on Wednesday that the agency is conducting a review of how Boeing made the manufacturing changes that led to the grounding — and why the potential safety issues weren’t discovered for about two years.

The fixes will be “pretty straightforward,” Dickson told House lawmakers during a virtual hearing in Washington.

Boeing faces extra scrutiny as it works to address manufacturing lapses, while convincing regulators globally that the Max is safe. A crash off the coast of Indonesia in October 2018 and another in Ethiopia less than five months later killed a total of 346 people.

After the U.S. cleared the jet for service in November of last year, ending a 20-month flying ban, Air Lease Corp. had high hopes for the Max’s comeback this year, said Steven Udvar-Hazy, the aircraft lessor’s chairman. That’s giving way to frustration over the latest disruptions and the lag by regulators in Russia, China, India and Korea in clearing the plane to fly.

“The airplane is very, very popular if we can get it back in the air,” Hazy said at a CAPA Live virtual conference on Wednesday. “Boeing needs to get their act together to get these airplanes back in service and provide incentives for airlines to stay with the program.”

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