Boeing 737 Max Cleared for Flight

Boeing 737 Max Cleared for Flight

December 30, 2020

On November 18, 2020, the FAA lifted the grounding order for Boeing’s 737 Max airplanes. After two fatal crashes, which were determined to be the result of flaws in a system software upgrade, the 737 Max has been grounded for about 20 months.

Southwest is the largest customer for the 737 Max (though not mentioned in the article, its entire fleet is comprised of 737 models).  34 completed aircraft are in “desert hibernation” in Victorville, CA, awaiting upgrades and FAA certification.  With the grounding order lifed, company mechanics are heading to Victorville to make the planes airworthy for travel to maintenance facilities for further work.

Although the planes were maintained in active storage, each one will require 280 hours of work and approved changes prior to this flight out of storage.

The bigger question is how customers will react.  Surveys indicate 25% are not comfortable flying the plane, so Southwest will allow penalty-free flight changes for those who choose to avoid this aircraft.

The Max is expected to enter revenue service in the second quarter of 2021.  In the meantime, 8,000 Southwest pilots will receive additional training including simulator time.


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Boeing Pursues Cost-Cutting Measures

Boeing Pursues Cost-Cutting Measures

December 30, 2020

The decline in air travel amid the pandemic has led Boeing to consider moving its commercial airplane headquarters in Washington from Renton to Everett.

Besides consolidating production of its 787 Dreamliner in South Carolina, Boeing also wants to establish a mobile leadership team by putting managers close to production and delivery facilities.


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This post is based on the Herald Net article, A Boeing executive delivers good and bad news for Everett, by Janice Podsada, October 23, 2020; the Puget Sound Business  Journal article, Renton mayor says Boeing 737 Max production isn’t moving to Everett, by Andrew McIntosh, November 19, 2020; the FlightGlobal article, Return of 737 Max marks just one of Boeing’s comeback challenges for 2021, by Jon Hemmerdinger, December 14, 2020; and the YouTube video in the Spotlight. Image source: ©Digital Vision/Getty Images, Inc.

Discussion Questions:

1. What measures did Boeing adopt to adjust its commercial airlines’ production, in response to the fallout from the coronavirus pandemic?

Guidance: Boeing adopted various cost-cutting measures, including consolidating production of its 787 Dreamliner Continue reading

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Stay-At-Home Improvements Mean Appliance Shortages

Stay-At-Home Improvements Mean Appliance Shortages

December 16, 2020

A surge in home improvement projects and new home construction has created a strong demand for appliances from refrigerators to washing machines. As a result, manufacturers, retailers, shippers, and raw materials suppliers are struggling to keep up with the strong demand.

Amid item shortages, retailers like Lowe’s are shifting from in-store showrooms to direct-to-customer deliveries.


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This post is based on the Business Insider article, Kitchen appliances and washing machines are in short supply as families stuck inside turn to home-improvement projects, by Graham Rapier, October 23, 2020; the Consumer Reports article, How to Get a Deal During the Appliance Shortage, by Tobie Stanger, December 10, 2020, and the YouTube video in the Spotlight. Image source: Corbis/Superstock

Discussion Questions:

1. How does the surge in demand of appliances affect inventory management for manufacturers such as Whirlpool?

Guidance: Appliance manufacturers maintain a low level of inventory to begin with. The level of inventory has remained low despite high production, resulting in order backlog and item shortages.

2.  How does the surge in demand of appliances affect its supply chain?

Guidance Continue reading

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