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MarketScreener Homepage  >  Equities  >  Euronext Paris  >  Airbus SE    AIR   NL0000235190

AIRBUS SE

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Airbus CEO: Boeing's Woes Could Dent Passenger Confidence, Hinder Regulator Cooperation -- 2nd Update

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05/16/2019 | 05:22am EDT

--Airbus's CEO said the grounding of the Boeing 737 Max plane could weaken passenger trust in aviation

--There has been tension between regulators, including the FAA and EASA, which will meet next week

--The EASA will review the FAA's findings on the MAX but will also assess the plane before allowing it to fly again

By Robert Wall

Airbus SE Chief Executive Guillaume Faury Thursday expressed concern that the grounding of the rival Boeing 737 MAX plane could dent passenger confidence and damage cooperation among international air safety regulators.

"There are a number of negative impacts for the industry," Mr. Faury told reporters.

Boeing's 737 MAX suffered two fatal crashes in less than five months, spurring safety concerns that led to the jet's global grounding in March.

Mr. Faury said that if passenger trust in aviation were weakened it would be negative for the entire industry.

He also voiced concern about "tension" between aviation regulators in different jurisdiction.

European and other foreign regulators were the first to ground the MAX before the U.S. Federal Aviation Administration, the primary air safety regulator for Boeing planes. FAA Acting Administrator Daniel Elwell Wednesday told U.S. lawmakers the overseas regulators acted without data.

Boeing is working on a fix to the MAX flight control system flaw implicated in the two crashes that took place in Indonesia and Ethiopia. The accidents killed 346 people.

The FAA plans a meeting next week with foreign air safety authorities to explain how it will review the fix. Mr. Elwell said he hopes those regulators will follow the FAA's recommendation with little lag.

Airbus's Mr. Faury said the historic cooperation between its own regulator, the European Union Aviation Safety Agency, and the FAA has been good for companies and safety.

"We need this alignment and this joint understanding on how to develop and certify planes to remain," he said.

Cologne, Germany-based EASA said it is working with the FAA to review the MAX but will also put the plane through separate scrutiny before deciding whether to allow it to resume carrying passengers. EASA officials are scheduled to attend next week's meeting.

"It is very important we have one system [for safety]," Mr. Faury said.

There are signs however that finding a global agreement could be difficult. The FAA has indicated it will not require specific MAX simulator training for pilots that previously weren't required. Other countries have signaled they may mandate such sessions.

The FAA, which has come under fire from lawmakers for allowing Boeing to approve some MAX safety features, said it is reviewing the process. Mr. Faury said that how the EASA and Airbus interact differs. But, he added, the European regulator is likely to study the FAA's eventual findings, which could also impact how Airbus does business.

European tour operator TUI, one of the region's biggest MAX operators, Wednesday said it will need clarity by the end of the month on whether the plane will be allowed to return to flight soon. Otherwise, the company expects to extend rentals for replacement planes.

Mr, Faury played down the prospect of any immediate benefit to Airbus from Boeing's woes. "We don't see anything positive from the current situation," he said.

Airbus's rival A320 planes are sold out through 2023, limiting its ability to provide any to MAX customers that may want to buy other planes.

Since the MAX fleet was grounded in March, several airlines have launched competitions for single-aisle planes. Mr. Faury said it was premature to judge whether the MAX situation would have an impact on the outcome.

Demand for planes hasn't been dented by the MAX situation, he added.

Mr. Faury also expressed concern that global trade tensions--particularly between the U.S. and China--could have negative implications for aerospace companies. "The trade tensions that we see, we believe they are lose-lose tensions," he said.

Write to Robert Wall at robert.wall@wsj.com.

Stocks mentioned in the article
ChangeLast1st jan.
AIRBUS SE -0.36% 122.84 End-of-day quote.47.20%
AIRBUS SE 0.00%End-of-day quote.0.00%
AIRBUS SE 0.39% 123.26 Real-time Quote.46.24%
BOEING COMPANY (THE) 0.77% 374.69 Delayed Quote.15.30%
BOEING COMPANY (THE) 0.00% 330 Delayed Quote.3.18%
TUI -0.27% 8.144 Delayed Quote.-33.61%
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