Norwegian Air cancels order for 97 Boeing aircraft, sues Boeing

https://airlinegeeks.com/2020/06/30/norwegian-air-cancels-order-for-97-boeing-aircraft-sues-boeing/

by cockpitherald • 6 years ago

198 164 6 years ago

I wonder who is going to have the guts to kill the 737 Max for good. It's never going to fly with airline and passengers ever again,

hn_throwaway_993• 6 years ago

That seems like a huge mistake to me. As it's been said many times, "Safety regulations are written in blood." At this point we probably know more about the flaws in the MAX than almost any other aircraft. And it's not like the plane was fundamentally unsound at a design level, but that bean counting, shortcuts and a failing culture made it unsound.

I mean, I haven't heard anyone of authority say the flaws with the Max aren't fixable. If the Max "never flies again", it will just be because it's rebranded, not because it's a fundamentally different aircraft.

paganel• 6 years ago

And it's not like the plane was fundamentally unsound at a design level, but that bean counting

I'm not an airframe designer by any means but from the countless threads that I've read on this website about this subject (coming from people who seemed more knowledgable than me on the subject) it did seem like the plane was fundamentally unsound at a design level.

sjm-lbm• 6 years ago

probably know more about the flaws in the MAX

The thing is, we do know a lot about those flaws and the only way to really fix those flaws is with a clean-sheet redesign.

The MAX would have flown again, for sure, pre-COVID. However, designs without known fundamental design flaws can handle worldwide airline lift needs for the foreseeable future.. and it's legitimate to wonder what that means for the future of the MAX.

numpad02• 6 years ago

Freight carriers still fly MD-11 as they’re economical and its flaws are well understood, but passenger carriers don’t touch it or the TriStar with a 10ft pole, I think that’s the answer.

kube-system3• 6 years ago

I think this might have some truth to it.

For example, the DC-10 was also a flawed airplane with a terrible safety record in the 70's which was grounded by the FAA as a result. But the flaws were fixed and the plane is still in operation today, now with a safety record comparable to other similar planes.

linuxftw4• 6 years ago

My guess is Russia or China. Then the US will be fomented into supporting this terrible plane as a patriotic duty. People will start taking "Freedom Flights" to prove to those bad people "over there" that America is #1!

LatteLazy• 6 years ago

Or just rebrand it.

I'm sort of amazed they haven't done that already...

BitwiseFool• 6 years ago

I don't know about you, but I never want to fly on a 737 MAX no matter what they rename it. Every time I have booked a ticket online the website tells me what kind of aircraft I would be flying on.

delhanty• 6 years ago

Last July:

A Boeing 737 Max due to be delivered to Ryanair has had the name Max dropped from the livery, further fuelling speculation that the manufacturer and airlines will seek to rebrand the troubled plane once it is given the all clear to fly again.
Photos have emerged of a 737 Max in Ryanair colours outside Boeing’s manufacturing hub, with the designation 737-8200 – instead of 737 Max – on the nose. The 737-8200 is a type name for the aircraft that is used by aviation agencies.

https://www.theguardian.com/business/2019/jul/15/boeing-737-...

MattGaiser• 6 years ago

Rebrand when it’s past certification. If it is rejected, then the new brand is contaminated.

marcosdumay• 6 years ago

If the US recertifies the B738-MAX8 with the automatic attitude management, a much more relevant brand will get tarnished.

kjaftaedi• 6 years ago

They have been rebranding it silently.

Boeing and some of their customers have switched back to using just numbers and leaving out the 'max' from the name.

If they did a public rebranding, it would defeat the purpose of trying to hide the name from the public.

bjarneh• 6 years ago

It's never going to fly with airline and passengers ever again,

What are Boing's alternatives here? I guess they should go back to the drawing board and scrap this idea of just adding some large engines on a plane that was not made for them. But that fatal idea, have put them in a horrible position.

The airline business seems to be very much about saving money on fuel, and creating a new fuel efficient airplane is going to take a lot of time (which is guess is why they did this quick and dirty hack the last time, to stay competitive).

In a business like that trust is everything, and I feel the more they are trying to force people into that flawed airplane, the less likely it seems that people will trust them ever again.

rbanffy• 6 years ago

The reason Boeing went with adding bigger engines to small a plane that couldn't have them is because airlines also like to save money in training and certification. If Boeing made them spend money in new training, they could spend money in better planes from the competition as well.

pcurve• 6 years ago

Yep. Trust is everything. Boeing is already on thin ice.

Just imagine, there is one more crash related to this, and what the fall out would be. Boeing as a company would be toast.

That's the risk Boeing is dealing with on hand.

And it won't be just Boeing's problem, it will also be airlines' problems for not taking firmer stance.

Gravityloss• 6 years ago

Well, now is the time for a clean sheet design. There isn't going to be any near term demand anyway.

When production really kicks in ten years from now, the world will look different - everybody is flying really old gas guzzler planes.

david38• 6 years ago

Of course it will. Software is much cheaper to iterate on than say wing design.

_lbaq4• 6 years ago

I would assume that most work is done in something like Dassault Systèmes Catia etc, so the wing is software also for most of its life...

alkonaut2• 6 years ago

Pre-covid I would have said of course it will fly. Because there is too much money at stake. Airlines aren't going to just cancel their orders and sell their MAX-8's and buy Airbus (suing Boeing for the difference).

Now with Covid, another possibility has opened up: a massive surplus of aircraft for the coming decade might actually make it redundant. Airlines will die left and right and there will be more than enough cheap planes to go around even without the MAX-8's.

I'd have no problem flying in one, as soon as authorities approve it.

catalogia4• 6 years ago

The MAX-8 was meant to be more fuel efficient than previous 737s, and from what I understand fuel is a huge expense for airlines. Could airliners truly become so cheap that fuel costs are no longer a consideration?

bootloop• 6 years ago

It was already approved by authorities once...

netsharc• 6 years ago

In Cuba people drive classic American cars because that's the last model cars they could get before the embargo started. Huh, imagine flying on 201x plane models in 2050 because there's just so many left around.

(Yeah I know there are probably 30 year old airframes still flying nowadays, and they're still airworthy).

kn0where3• 6 years ago

The international regulators are getting their modifications made. The plane is undergoing new flight tests as of this week. It will be a slow restart due to COVID but the plane has survived the biggest obstacles already. It will be in passenger service again.

V_Terranova_Jr• 6 years ago

This reflects a lack of understanding how the U.S. Government works. There's essentially zero chance your statement is correct. There will be changes made to the aircraft, changes to training regimen, multiple reviews, etc., but the 737 Max will be recertified to fly. That shouldn't be taken as an endorsement, just an acknowledgement of reality.

Source: You can look up my profile and comment history. I don't work on the civil side, but I know how things work in the USG.

TheJoeMan• 6 years ago

Imagine getting to break your contract and then sue to try to get your initial deposit back. Isn't that the whole point of a deposit?

FabHK7• 6 years ago

But what if the supplier cannot deliver what they promised? If Tesla cannot deliver the <XZY>, can they keep your deposit?

koolba• 6 years ago

Not necessarily. A refundable deposit is not unheard of. It's a good way to verify that your customer's are truly interested and at least partially capable of paying for the final product.

For example, Tesla's deposit is refundable: https://www.tesla.com/support/model-3-reservation-deposit

blinding-streak3• 6 years ago

Except that in practice, getting your refund back is not easy at all. Tesla marketing and Tesla reality are often far apart.

https://www.cnbc.com/2019/02/21/tesla-refund-and-return-prob...

https://www.bloomberg.com/news/articles/2019-02-20/tesla-wou...

https://forums.tesla.com/forum/forums/deposit-refund-3

throwanem5• 6 years ago

Their argument seems to be roughly akin to a claim on the common law's implicit warranty of merchantability. You could also think of it as a "lemon law" claim, maybe.

It'll be interesting to see how that plays out, for Boeing as well as for Norwegian. I doubt they're the only airline that's been considering this kind of action.

x86_64Ubuntu• 6 years ago

I'm sure the deposit has conditions on it. No one would ever put down so much money just to eat all of the future risk.

ceejayoz2• 6 years ago

If the people you gave the deposit to break their side of the contract, why not?

raverbashing• 6 years ago

Imagine selling a(n extremely expensive) product that does not do what it was promised to do and is a money sink even when not running

humanlion87• 6 years ago

Couldn't the contract also have some clause with respect to timelines for delivery. Then they'd have the right to sue and get their money back.

jeltz• 6 years ago

Sounds perfectly normal if the reason for breaking the contract is failure to deliver.

ashtonkem8• 6 years ago

Imagine collecting a deposit, not delivering a usable product, and expecting to keep the deposit.

blinding-streak3• 6 years ago

The entire airline industry (and travel as a whole) is under incredible stress right now. Many airlines have already gone bankrupt [1], and most others are near the brink. I don't think there's going to be any shortage of lawsuits going forward.

[1] https://www.businessinsider.com/coronavirus-airlines-that-fa...

ceejayoz2• 6 years ago

I suspect a lot of the lawsuits will outlive the airlines filing them.

the-dude• 6 years ago

Bankruptcies can take years or decades.

tyingq2• 6 years ago

Most of the US airlines took the COVID bailout bill money. That bill required them to maintain specific service, and avoid layoffs through the end of September. Expect some chaotic changes in October.

throw513192• 6 years ago

Do you think the US gov won't renew those?

api• 6 years ago

Maybe we can reboot it with dedicated per-route mini-airports with oriented runways that lob electric planes between cities, like high speed rail but without the right of way issues and monstrous capital cost (for a big country with a lot of empty space like the USA).

exabrial• 6 years ago

Reading between the lines of hype, this is the most important fact in the article:

[Norwegian Air] delayed general shareholders meeting on Tuesday and on the same day Boeing started re-certification tests for MAX aircraft

niffydroid• 6 years ago

Aerospace is taking a massive hit, in the UK we've seen redundancies and are seeing more today.

donut2d• 6 years ago

There was recent news(April/March) about Norwegian actually running extremely low on cash to a point of bankruptcy and the airline laid off like 90% of their workforce due to Covid19 pandemic and lack of flights/demand.

SOLAR_FIELDS• 6 years ago

I really hope this doesn’t happen - Norwegian is the best low cost long haul airline out there. Round trip AUS-LGW tickets can be found for sub $500 on Norwegian. The premium is also very competitive for the same flight ($800-1200) when competitors doing similar route (BA) charge more than double that, and the service certainly isn’t doubled. They are also flying very new planes and as such are a much nicer experience. There are always plugs under the seats, IFE is modern and available on every seat. Also the way they handle seat service is much more convenient, you order and pay through the IFE console instead of having to wait for the cart to come around and as such you have complete service all the way though the flight.

Even on domestic flights in Europe they are a pretty reasonable experience, much better than Ryanair and Easyjet at least. They are often priced about 10-20% more expensive than Ryanair and Easyjet when you probably get double the comfort and service and half the annoyances. I might sound like a shill for Norwegian but I think they really fill the Southwest niche here - a decently low cost (but not lowest) airline that doesn’t treat you or it’s employees like shit.

That’s not to say they are without flaws either. I and others have had some sketchy times where Norwegian has fought awarding the EU mandated reimbursement for delayed/cancelled flights. But no other international airline in Europe straddles the line between legacy carrier level of service and barebones low-cost as well as Norwegian.

menybuvico• 6 years ago

Fought is expressing it mildly; they're outright refusing unless you threaten them with court action.

pb7• 6 years ago

For what it’s worth, I also deeply enjoyed every long haul flight I’ve taken on Norwegian B787s. The value was definitely there.

ConceitedCode• 6 years ago

The article talks about the airline focusing on shorter routes and cutting the longer routes that they were losing money on. Even if the airline doesn't go through bankruptcy the long haul routes at the same price will probably no longer be around.

"However, with the scheduled flights gradually resuming, the airline is restructuring its fleet and focusing on short- and medium-range destinations. Europe’s fourth-largest low-cost carrier will likely completely discontinue the long-haul flights that sank the company into debt."

jimbob45• 6 years ago

Boeing has terrible management and deserves to go under for the 737 Max fiasco but...

...it seems like maybe Norwegian Air is reeling from coronavirus-induced low demand and is trying to escape its responsibilities.

ashtonkem8• 6 years ago

Bit of both. Norwegian Air needs money, no doubt. But Boeing took a deposit and didn’t deliver a usable product. Under certain circumstances it makes sense for Boeing to return the deposit; they didn’t uphold their end of the deal. The lawsuit will almost certainly hinge on the terms of the deal and whatever local precedence and law might exist in this area.

steffan• 6 years ago

Boeing has terrible management and deserves to go under for the 737 Max fiasco

This seems a bit like throwing the baby out with the bathwater. Boeing employees 145,000 people. You're advocating making the equivalent of a small city jobless based on the actions of a very small contingent.

Additionally, aerospace is a capital intensive business. To give up Boeing would mean the likely-permanent loss of sophisticated manufacturing capabilities in the United States.

Nobody is starting a new aircraft manufacturer on AWS using Javascript. It would take tens of billions of dollars to even begin to attempt to re-create a company with Boeing's capabilities.

jellicle2• 6 years ago

You're advocating making the equivalent of a small city jobless based on the actions of a very small contingent.

No one has ever advocated that every person at Boeing be fired and that's not what happens in large corporate bankruptcies. So no, that's not what the other poster was advocating.

In general, I've seen people advocating that Boeing's shareholders be wiped out, senior management fired and the company be rebooted with a thorough dedication towards "safety first" as opposed to "short-term profits first".

_lbaq4• 6 years ago

BOC Aviation, controlled by the Chinese state, is now a majority owner of Norwegian, BOC have previously canceled 737 Max orders.

https://www.thelocal.no/20200520/china-become-norwegians-big...

tankenmate• 6 years ago

Interesting. Anyone have any idea if this will lead to a Comac C919 order? [0] Just remembered, this would have to pass the EASA certification at a minimum, if that happens or they start pushing for it it might be an indicator. Belt and Road no doubt, and quite possibly seeking to capitalise on the duopoly having a hard time. May lead to EU / US shoring up their respective industries. Maybe also burying their WTO hatchets?

[0] https://en.wikipedia.org/wiki/Comac_C919

[EDIT] asked further questions

FreakyT• 6 years ago

My first thought as well -- would be interesting to see the C919 flown on more western routes.

rurban• 6 years ago

Much more likely are replacements with Airbus if they can get the Boeing money back. Boing being now a hedgefund company, not an engineering company anymore (like VW), this sounds difficult and the lawsuit could last several years. So it looks like Norway has to stick with their Boing's.

I never heard of the 787 engine problems, this seems to be severe also.

The Comac is an interesting option, but it will still need several years. Airbus is the only option.

kn0where3• 6 years ago

Zero reason for a Comac order when there’s tons of used A320s and 737s sitting around up for sale or lease.

numpad02• 6 years ago

Comac is expected to pass European certifications? I can’t be pissed more about MRJ/MSJ right now...

apta2• 6 years ago

How did they allow this sale to happen? It's like they're willingly giving themselves away to the Chinese gov't.

kn0where3• 6 years ago

Norwegian is not the main airline of Norway (that would be SAS in conjunction with Sweden and Denmark). Norwegian is (was?) a low cost airline that expanded too fast and used various subsidiaries to incorporate most of their airline in other countries like Argentina or the UK. They have very little in actual assets, they’ve been hurt three times over by 787 engine issues, the 737 MAX, and now COVID, and now their creditors are taking whatever scraps are left.

ThinkBeat2• 6 years ago

um.

Are you saying there needs to be a global ban on allowing Chinese entities to invest?

Why would not some entity in China be allowed to own a share?

marvin• 6 years ago

Conversion of debt to equity. The alternative was bankruptcy, triggered by the coronavirus crisis. Norwegian is privately founded and owned. No government involvement. No bailout.

bsimpson• 6 years ago

12 2/3% is big, but it's not a majority.

Norwegian Air cancels order for 97 Boeing aircraft, sues Boeing

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