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A question at the Paris Air Show: Will Boeing CEO Muilenburg survive?

Dominic Gates, The Seattle Times on

Published in Business News

PARIS -- One of Boeing's biggest 737 MAX customers sharply criticized the company's handling of the crisis resulting from two recent crashes, and raised the stark question of whether Boeing Chairman and Chief Executive Dennis Muilenburg will be forced out as a result.

In an interview at the Paris Air Show, Avolon chief executive Domhnal Slattery, who runs the third-largest airplane leasing company in the world, said the additional bad news in Paris Monday of a delay to the 777X program will only feed "the swirling debate: whether Muilenburg will survive all of this."

"I think he has the support of the Boeing board," Slattery said. "But our view here is that Boeing have failed to win the media communications battle. They are forgetting about the most important constituency, which is the hundreds of millions of potential passengers."

He said the refusal of Boeing to fully and publicly accept its share of the blame, an approach that has produced awkward moments with Muilenburg seemingly bound by legal restrictions from being too plain-spoken, has damaged Boeing's reputation, especially overseas.

"You can understand that as a legal strategy," Slattery said. "But if you play that out to its Black Swan scenario, there's a scenario that says the aircraft program gets canceled."

"What if the airplane gets back into the air and no one wants to fly it for 12 or 24 months?" he asked. "Every airline in the world will want to cancel or defer."

 

Chinese-owned but based in Dublin, Avolon owns or manages more than 550 airplanes and has ordered just shy of 400 more from Airbus and Boeing. It owns nine 737 MAXs, currently grounded, and has 132 more on order.

As a customer with a big stake in how the MAX grounding plays out, Slattery is clearly very unhappy with Boeing's crisis management.

He said that in decades past, the traveling public over time generally moved on and forgot about plane crashes, though air disasters were more common events then. Now, he said, "it's a very different world, with the transparency and flow and speed of information and flight booking engines that allow you to select the aircraft type."

"It's a very real issue, country by country," Slattery said, reflecting what he's hearing from airline clients. "Take Indonesia. The regular passenger in Indonesia thinks this crash (of Lion Air Flight 610 that killed 189 people) should never have happened, that it wasn't Lion Air's fault, it was the aircraft's fault."

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