Despite the fact that Chinese aviation authorities have decided to ground all Boeing 737 MAX planes from domestic flights on Monday, two deadly crashes in recent months involving the US aircraft maker's popular narrow-body airplane are unlikely to hurt its market share in China in the long term, experts told Sputnik
MOSCOW (Pakistan Point News / Sputnik - 12th March, 2019) Despite the fact that Chinese aviation authorities have decided to ground all Boeing 737 MAX planes from domestic flights on Monday, two deadly crashes in recent months involving the US aircraft maker's popular narrow-body airplane are unlikely to hurt its market share in China in the long term, experts told Sputnik.A Boeing 737 MAX 8 operated by Ethiopian Airlines crashed shortly after takeoff on Sunday, killing 157 people on board. The tragic accident marked the second deadly crash in less than five months that involved Boeing's hot selling aircraft, which has been developed as the US aircraft maker's answer to the A320 Neo from its European rival Airbus. In October 2018, a Boeing 737 MAX 8 operated by the Indonesian airline Lion Air crashed also shortly after takeoff, killing 189 people.
The consecutive crashes involving the recently delivered Boeing 737 MAX 8 have raised questions on whether the aircraft itself had issues that contributed to the accidents, despite the fact that investigations on the causes of both crashes are still under way. Aviation authorities in China, Ethiopia and Indonesia have grounded the Boeing 737 MAX planes, while Cayman Airways from the Cayman Islands and Jet Airways from India took similar actions.
Major US air carriers such as Southwest Airlines and American Airlines, who are key customers of Boeing 737 Max planes, have decided to continue to operate flights with the aircraft in question. Panicked customers flooded social media accounts of those US airlines with questions over the planes used in their upcoming flights, as part of their efforts to avoid flying on board the Boeing 737 MAX.
Despite facing an uphill battle in restoring the general public's confidence in its flagship aircraft, Boeing is unlikely to lose its market share in China, which is expected to become the world's largest aviation market by 2022, political analysts told Sputnik.
"Many previous models of aircraft have also been involved in tragic accidents. As long as investigation results can prove that the airplanes do not have obvious quality issues, I don't think it'll be a problem. The investigations could root out design flaws with the aircraft, because many other countries are flying the same aircraft on a daily basis. The two accidents could just be a coincidence. I don't think it'll have a major impact on China's future purchases of aircraft from Boeing," Zhang Baohui, the director of the Center for Asian Pacific Studies at Hong Kong's Lingnan University, told Sputnik.
The expert stressed that Boeing has to take swift actions to try to restore its reputation and credibility among consumers.
"Boeing has to take measures as soon as possible to resolve this problem. It has to address the questions raised globally and come up with an answer through thorough investigations. Most of the planes from Boeing are still very safe. Even when there was an issue with a specific model, it was not like global consumers would abandon Boeing's planes altogether," he said.
Other Chinese aviation experts argued that Boeing's market share in China could be affected if it does not handle the crisis with the deadly crashes properly.
"If this [the crisis with the crashes] is not handled properly, it will undoubtedly hurt Boeing's business reputation. It could leave an impression among Chinese consumers that all of the planes from Boeing 737 series are not safe, because average consumers can't really tell the difference between different models of Boeing aircraft. In the narrow-body aircraft market segment, you only have two choices today, A [Airbus] or B [Boeing]. If handled improperly, it could hurt Boeing's market shares," Zou Jianjun, a professor at the Civil Aviation Management Institute of China, told Sputnik.
Amid heated trade negotiations between China and the United States, the swift decision from Chinese aviation authorities to ground all 737 MAX planes in the country has raised questions on whether Beijing is trying to seek additional leverage in the trade talks, as aircraft from Boeing is a key part of US exports.
However, Professor Zhang from Lingnan University dismissed the notion that China's decision to ground Boeing 737 MAX planes is related to the ongoing trade talks.
"I don't think it's related to the trade talks, as many other countries have also grounded the Boeing 737 MAX. If China wants to buy more US airplanes as part of its commitment to address the trade imbalance, it can choose other aircraft models from Boeing. This is not the only product from Boeing. That's why I believe China's decision is not related to the trade talks. I don't think it is part of China's effort to put more pressure on the United States," he said.
During US president Donald Trump's visit to China in November 2017, Boeing signed a $37 billion agreement to sell 300 airplanes to China Aviation Supplies Holding Company. According to the latest figures from Boeing, 104 out of the 122 unfilled orders from China are the 737 MAX planes. As of January 2019, a total of 76 Boeing 737 MAX planes have been delivered to various customers in China, the figures from Boeing showed.
Professor Zou from the Civil Aviation Management Institute of China stressed that Beijing's decision to ground all Boeing 737 MAX came from its commitment to safety in air travel.
"From our perspective, safety is the top priority. That's why the Chinese aviation authorities were the first to found all Boeing 737 MAX. When it comes to the quality of an airplane, whether it is safe has always been the Primary concern," he said.
The expert added that the Boeing's experience with the 737 MAX has offered important lessons for China's upcoming domestically developed C919 narrow-body passenger aircraft, which strive to compete with Airbus and Boeing in global markets. The Chinese aircraft manufacturers need to demonstrate the safety and trustworthiness of the C919 to global customers during trial flights, the expert stressed.
