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BOEING COMPANY (THE)

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Aerospace Upstart Changes How Planes Are Tracked

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03/14/2019 | 03:27pm EDT

By Robert Wall

When the Federal Aviation Administration reversed course and grounded Boeing Co.'s 737 MAX jetliner, it moved partly after seeing data from a little-known aerospace newcomer that is changing the way the aviation industry tracks planes.

Aireon LLC, based in McLean, Va., was founded less than a decade ago -- the brainchild of satellite maker Iridium Communications Inc. and Canada's government-owned air-traffic managers. Aireon collects and then distributes to partners, including air-traffic-control providers around the world, some of the operational data that passenger jets automatically send out in real time.

Using gear it has placed on satellites, Aireon collects data such as a plane's speed, heading, altitude and position. It gets updates every eight seconds or less. Air-traffic-control providers increasingly use the data to track planes from tarmac to tarmac -- a capability only made possible with the development of sophisticated satellite networks.

In the case of Ethiopian Airlines Flight 302, which crashed Sunday killing 157, Aireon said it started furnishing its raw data as early as Monday to the FAA, the National Transportation Safety Board, Canadian officials and other authorities. The data would have required some time to analyze, according to an Aireon spokeswoman.

Once recipients crunched the numbers, they found similarities between the six-minute flight path of the crashed Ethiopian Airlines 737 MAX and that of a Lion Air 737 MAX that crashed, after 11 minutes, killing all 189 aboard, less than five months earlier. Canadian officials said they had finished analyzing the Aireon-provided data only by Wednesday morning. They decided to ground the jet a few hours later. President Trump announced a U.S. grounding a few hours after that.

The FAA isn't an Aireon investor, though the two have worked together previously and plan a limited evaluation of the company's services in the U.S.

Aireon declined to make executives available, saying the company wanted to avoid the appearance of seeking publicity after the Ethiopian Airlines crash.

The Aireon data that proved helpful was the plane's so-called vertical velocity, the rate at which the jet climbed and descended before crashing. In the six minutes from takeoff, the plane experienced sharp changes in vertical velocity, indicating it was rapidly gaining and losing altitude -- just like the Lion Air flight had.

That "suggested a possible although unproven similarity in the flight profile" of the two jets, said Canada's transport minister, Marc Garneau, at news conference announcing the grounding Wednesday. Authorities say the similarities don't show any concrete, causal link between the two crashes, but they were enough to warrant grounding the fleet until a more-thorough investigation can occur. Boeing says its 737 MAX is safe, but that the grounding was warranted.

Preliminary findings in that crash spurred Boeing to start work on a fix to the model's stall-prevention system. That should be introduced before the end of April. The system appears to have repeatedly pushed down the nose of the plane during the flight. Investigators also are looking at other factors, including plane maintenance. Lion Air has said the plane was well-maintained.

Aireon is owned by Iridium; Nav Canada, the Canadian air-traffic-control agency; and a handful of other air-traffic-control providers, including those in Britain and Ireland. In addition to providing data to these agencies, Aireon courts airlines and other private clients, which pay for data subscriptions.

Aireon currently offers its services to 11 air-traffic-service providers spanning 28 countries. Several airlines have signed up to access the information through a partnership between Aireon and flight tracker FlightAware, including Qatar Airways and Malaysia Airlines. No U.S. airline has said it is using the system. Airlines typically pay $200 per plane per month for a subscription.

The idea for Aireon was born at Iridium, when the company was developing the concept for a new constellation of satellites about a decade ago. The satellites had room to spare, and Iridium Chief Executive Matt Desch and another top executive, Don Thoma, started searching for applications.

After talks with Nav Canada, they decided to focus on air-traffic control. Mr. Thoma left Iridium to run Aireon.

Aireon relies on transmissions from a system called Automatic Dependent Surveillance-Broadcast, or ADS-B. It has equipment to receive those broadcasts on 66 Iridium satellites. The company, with 75 employees, only last month finished building out the tracking constellation. It is still in final testing, the spokeswoman said, and full services for clients won't go live until later this month.

Though founded in 2011, interest in this kind of global tracking system took off about five years ago, after Malaysia Airlines Flight 370 was lost over the Pacific when flying from Kuala Lumpur to Beijing. The Boeing 777-200ER jetliner changed course, for still unexplained reasons, and was lost with all 239 people onboard, now presumed dead. Flight 370's course change was picked up by a different type of satellite system provided by Inmarsat PLC. The plane still hasn't been found.

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

Stocks mentioned in the article
ChangeLast1st jan.
BOEING COMPANY (THE) 10.91% 366 Delayed Quote.14.12%
BOEING COMPANY (THE) -2.83% 362.17 Delayed Quote.15.57%
IRIDIUM COMMUNICATIONS INC -1.53% 26.4 Delayed Quote.43.09%
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Financials ($)
Sales 2019 111 B
EBIT 2019 14 655 M
Net income 2019 12 495 M
Debt 2019 6 106 M
Yield 2019 2,23%
P/E ratio 2019 16,38
P/E ratio 2020 14,38
EV / Sales 2019 1,89x
EV / Sales 2020 1,76x
Capitalization 204 B
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Number of Analysts 25
Average target price 437 $
Spread / Average Target 21%
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NameTitle
Dennis A. Muilenburg Chairman, President & Chief Executive Officer
Jenette E. Ramos Senior Vice President-Supply Chain & Operations
Gregory D. Smith CFO, EVP-Corporate Development & Strategy
Theodore Colbert Chief Information Officer & SVP-Data Analytics
Gregory L. Hyslop CTO, Senior VP-Engineering, Test & Technology
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