S AT U RDAY , J AN U ARY 11, 2020 | T HE GLOB E AND MAIL G R EPORT ON BUSINESS | B9

Boeing employees criticize 737 Max, Ousted Boeing

CEO leaves
regulators in internal messages company with
In an attempt to increase more than
transparency with the FAA,
plane maker discloses $60-million
hundreds of exchanges
DAVID SHEPARDSON
DAVID SHEPARDSON WASHINGTON TRACY RUCINSKI

Boeing Co. has released hundreds of in-
ternal messages that contained harshly
critical comments about the develop-
ment of the 737 Max, including one that
said the plane was “designed by clowns
who in turn are supervised by mon-
keys.”
The messages, disclosed on Thursday,
show attempts to duck regulatory scru-
tiny with employees disparaging the
plane, the company, the Federal Avia-
tion Administration (FAA) and foreign
aviation regulators.
In an instant-messaging exchange on
Feb. 8, 2018 – when the plane was in the
air and eight months before the first of
two fatal crashes, an employee asks an-
other: “Would you put your family on a
Max simulator trained aircraft? I
wouldn’t.”
The second employee responds:
“No.”
The 737 Max has been grounded since
March after an Ethiopian Airlines flight
nosedived, just five months after a simi-
lar Lion Air crash. The two disasters
killed 346 people.
In particular, some of the communi-
cations reveal efforts by Boeing to avoid
making pilot simulator training – an ex-
pensive and time-consuming process –
a requirement for the 737 Max.
The plane maker just this week
changed tack, saying it would recom-
mend pilots do simulator training
before they resume flying the 737 Max –
a major shift from its long-held position
that computer-based training was suffi-
cient as the plane was similar to its pred-
ecessor, the 737 NG.
The release of the messages, which
highlight an aggressive cost-cutting cul-
ture and disrespect toward the FAA, is
set to deepen the crisis at Boeing, which
is struggling to get its best-selling plane
back in the air and restore public confi-
dence.
The FAA said, however, that the mess-
ages do not raise new safety concerns,
although “the tone and content of some
of the language contained in the docu-
ments is disappointing.”
Boeing said the communications “do
not reflect the company we are and
need to be, and they are completely un-
acceptable.”
The disclosure, which Boeing said
was in the interest of transparency with
the FAA, prompted renewed outrage
from U.S. lawmakers and puts more
A Lion Air Boeing 737 Max 8 airplane is seen at Soekarno-Hatta International Airport
near Jakarta last March. The plane was grounded that month after an Ethiopian Airlines
flight crashed five months after a similar Lion Air crash. WILLY KURNIAWAN/REUTERS
pressure on Boeing’s new chief execu-
tive David Calhoun to overhaul the com-
pany’s culture when he takes the reins
on Monday.
U.S. House transportation committee
chairman Peter DeFazio, who has been
investigating the Max, said the messages
“paint a deeply disturbing picture of the
lengths Boeing was apparently willing to
go to in order to evade scrutiny from reg-
ulators, flight crews and the flying pub-
lic, even as its own employees were
sounding alarms internally.”
Senator Roger Wicker, who chairs the
commerce committee leading the Sen-
ate’s probe into Boeing, also said the lat-
est documents “raise questions about
the efficacy of FAA’s oversight of the
certification process.”
The U.S. Justice Department has an
active criminal investigation under way
into matters related to the 737 Max
plane.
Some of the messages pointed to
problems with the simulators. Boeing
said on Thursday it is confident “all of
Boeing’s Max simulators are functioning
effectively” after repeated testing since
the messages were written.
The messages, however, show Boeing
in the past was doing all it could to lobby
aviation regulators to avoid the need for
airlines to train pilots in a simulator on
the differences between the 737 Max
and the 737 NG.
“I want to stress the importance of
holding firm that there will not be any
type of simulator training required to
transition from NG to Max,” Boeing’s 737
chief technical pilot said in a March,
2017, e-mail.
“Boeing will not allow that to happen.
We’ll go face to face with any regulator
who tries to make that a requirement.”
Before the grounding, pilot training
on the differences consisted of a one-
hour lesson on an iPad and no time in
the simulator, according to the union
representing pilots at American Air-
lines.
Shukor Yusof, the head of Malaysia-
based aviation consultancy Endau Ana-
lytics, said Boeing should get credit for
disclosing the “destructive diatribes.”
“Initially the flying public will under-
standably have reservations, but the air-
craft – having been completely and re-
sponsibly resurrected – will likely be one
of the safest planes around,” he said.
In other e-mails and instant messag-
es, employees spoke of their frustration
with the company’s culture, complain-
ing about the drive to find the cheapest
suppliers and “impossible schedules.”
“I don’t know how to fix these things
… it’s systemic. It’s culture. It’s the fact
we have a senior leadership team that
understand very little about the busi-
ness and yet are driving us to certain ob-
jectives,” an employee said in an e-mail
dated June, 2018.
And in a May, 2018, message, an un-
named Boeing employee said, “I still
haven’t been forgiven by god for the cov-
ering up I did last year.”
Without referencing what was cov-
ered up, the employee added: “[Can’t]
do it one more time. [The] Pearly gates
will be closed. …”
REUTERS
BOEING (BA)
CLOSE: US$329.92, DOWN US$6.39
Boeing Co.’s ousted chief executive,
Dennis Muilenburg, stands to receive
US$62-million in long-term incentive,
stock awards and pension benefits, but
forfeited US$14.6-million and will re-
ceive no severance, the plane maker said
in a regulatory filing on Friday.
Mr. Muilenburg, 62, was fired from the
job in December as the company failed
to contain the fallout from a pair of fatal
crashes that halted output of its bestsell-
ing 737 Max jetliner and tarnished its
reputation with airlines and regulators.
He was replaced by Boeing board
chairman David Calhoun, 62, a turn-
around veteran and former General
Electric Co. executive who has led sever-
al companies in crisis.
Mr. Calhoun, who starts as CEO on
Monday, will receive a base salary at an
annual rate of US$1.4-million and is eli-
gible for US$26.5-million in long-term
incentive compensation, Boeing said in
a filing.
Boeing said in November Mr. Muilen-
burg had volunteered to give up his 2019
bonus and stock awards. For 2018, his bo-
nus and equity awards amounted to
some US$20-million, according to fil-
ings. “Upon his departure, Dennis re-
ceived the benefits to which he was con-
tractually entitled and he did not receive
any severance pay or a 2019 annual bo-
nus,” Boeing said in a statement.
The 737 Max has been grounded since
March. The deadly accidents in Indone-
sia and Ethiopia within five months
killed 346 people.
The severance disclosure comes after
Boeing’s release late on Thursday of
hundreds of internal messages that con-
tained harshly critical comments about
the development of the 737 Max, includ-
ing one that said the plane was “de-
signed by clowns who in turn are super-
vised by monkeys.”
Speculation that Mr. Muilenburg
would be fired had been circulating in
the industry for months, intensifying in
October when the board stripped him of
his chairman’s title – although he had al-
so twice won expressions of confidence
from Mr. Calhoun.
Boeing also disclosed that Kevin
McAllister, who was fired as CEO of Boe-
ing Commercial Airlines in October, for-
feited US$52.9-million in unvested equi-
ty awards and other compensation.
REUTERS

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LEGA LS

CANADA GUARANTY
FINANCIAL CORPORATION

APPLICATION
TO ESTABLISH
AN INSURANCE
COMPANY
Notice is hereby given, pur-
suant to subsection 25(2) of
the Insurance CoTpanies Act
(Canada), that Canada Guaranty
Financial Corporation intends to
apply to the Minister of Finance
for letters patent to incorporate
a Tortgage insurance coTpany.
The proposed Tortgage insur-
ance coTpany will carry on
business in Canada under the
English naTe CG Plus Mortgage
Insurance CoTpany and under
the French naTe Société
d’assurance hypothécaire CG
Plus. Its head office will be
located in Toronto, Ontario.
The proposed Tortgage insur-
ance coTpany intends to
engage in residential Tortgage
default insurance and related
activities.
COMPETITION ACT
Notice is hereby given that, on DeceTber 19, 2019, an application
pursuant to section 92 of the CoTpetition Act, RSC 1985, c C-34
(“Act”) was filed with the undersigned at the CoTpetition Tribunal
(“Tribunal”) by the CoTTissioner of CoTpetition (“Commissioner”),
regarding the acquisition by Parrish & HeiTbecker, LiTited (“P&H”)
of certain grain elevators and related assets froT Louis Dreyfus
CoTpany Canada ULC (“Application”).
The particulars of the orders sought by the CoTTissioner are as
follows:
• an order requiring P&H to dispose of all of the assets of the ongo-
ing business of a priTary grain elevator in the relevant Tarkets (as
defined in the Application) (“Relevant Markets”), as well as such
other assets, if any, as are required for an effective reTedy;
• an order prohibiting P&H froT acquiring, within a period of five
(5) years froT the date of the order, any priTary grain elevator in
the Relevant Markets, unless P&H provides the CoTTissioner with
at least 30 days’ advance written notice of such proposed Terger,
where the proposed Terger would not otherwise be subject to
notification pursuant to the Act;
• an order directing P&H to pay costs; and
• such further and other relief as the CoTTissioner Tay request and
this Tribunal Tay consider appropriate.
LOI SUR LA CONCURRENCE
Prenez avis que, le 19 déceTbre 2019, le coTTissaire de la concur-
rence (« le commissaire ») a déposé une deTande, au titre de l’article
92 de la Loi sur la concurrence, L.R.C. 1985, ch. C 34 (« la Loi »), auprès
de la soussignée, au Tribunal de la concurrence (« le Tribunal »), con-
cernant l’acquisition par Parrish & HeiTbecker LiTited (« P&H ») de
certains élévateurs à grains et d’éléTents d’actif connexes auprès de
Louis Dreyfus CoTpany Canada ULC (« la demande »).
Les ordonnances sollicitées par le coTTissaire sont les suivantes :
• une ordonnance enjoignant à P&H de se départir de tous les
éléTents d’actif actuelleTent liés à l’exploitation d’un élévateur à
grains priTaire sur les Tarchés concernés (définis dans la deTande)
(« les marchés concernés »), ainsi que de tout autre éléTent d’actif,
le cas échéant, perTettant d’assurer une Tesure corrective efficace;
• une ordonnance interdisant à P&H d’acquérir, au cours des cinq
(5) années suivant la date de l’ordonnance, tout élévateur à grains
priTaire sur les Tarchés concernés, à Toins que P&H donne au
coTTissaire un préavis écrit d’au Toins trente (30) jours de tout
projet de fusionneTent, dans les cas où le fusionneTent proposé
ne devrait pas autreTent faire l’objet d’un avis en vertu de la Loi;
• une ordonnance enjoignant à P&H de payer les dépens;
• une ordonnance accordant toute autre réparation que le coTTissaire
peut deTander et que le Tribunal peut juger appropriée.

Any person who objects to
the issuance of these letters
patent Tay subTit an objec-
tion in writing to the Office of
the Superintendent of Financial
Institutions, 255 Albert Street,
Ottawa, Ontario K1A 0H2, on
or before February 17, 2020.
Note: The publication of this
notice should not be construed
as evidence that letters patent
will be issued to incorporate
the Tortgage insurance coT-
pany. The granting of the let-
ters patent will be dependent
upon the norTal Insurance
CoTpanies Act (Canada) appli-
cation review process and
the discretion of the Minister
of Finance.
DeceTber 28, 2019
Canada Guaranty Financial
Corporation
Notice is hereby given that any Totion for leave to intervene in this
Tatter Tust be filed with the Tribunal on or before February 12,
2020.
The notice of application Tay be exaTined at the registry of the
Tribunal or a copy Tay be obtained by visiting the Tribunal’s web-
site at www.ct-tc.gc.ca. Requests for inforTation regarding this
Application should be addressed to the undersigned, by Tail at
the CoTpetition Tribunal, 600 – 90 Sparks Street, Ottawa, Ontario
K1P 5B4, by telephone at 613 954 0857, or by e Tail at: Tribunal@
ct-tc.gc.ca.
DeceTber 31, 2019 — Andrée Bernier
Deputy Registrar
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Prenez avis que toute requête en autorisation d’intervenir dans la
présente affaire doit être déposée auprès du Tribunal au plus tard le
12 février 2020.
L’avis de deTande peut être consulté au greffe du Tribunal. Il est
égaleTent possible d’en obtenir une copie sur le site Web du Tribunal,
à l’adresse www.ct-tc.gc.ca. Toute deTande de renseigneTents
concernant la présente deTande doit être adressée à la soussignée,
soit par la poste à Tribunal de la concurrence, 90, rue Sparks,
bureau 600, Ottawa (Ontario) K1P 5B4, soit par téléphone au nuTéro
613 954 0857, soit par courriel à l’adresse Tribunal@ct-tc.gc.ca.
Le 31 déceTbre 2019 — Andrée Bernier
Registraire adjointe
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