Boeing (BA) lost a lot of ground over the last week.
In fact, shares fell from $370 to $325. All after Reuters reported that Boeing turned over instant messages from 2016 between two employees that suggest the company may have mislead the Federal Aviation Administration (FAA) about a key safety system on the 737 MAX.
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In its most stunning admission before Congress, Boeing said it made mistakes in developing the 737 Max plane, which was grounded after two crashes. “In the months since the accidents, there has been much criticism of Boeing and its culture. We understand and deserve this scrutiny,” said Boeing CEO Dennis Muilenburg, as quoted by CNN.
“At issue is a flight-control system known as MCAS that malfunctioned on both flights because it received erroneous data from a faulty sensor,” says CNBC. “The sensor measures the angle of attack, or the angle of the plane relative to oncoming air. If the nose is pointed too high, the plane could stall, so the system automatically pushes the nose of the planes down.”
With both crashes – including the Java Air Flight 610 and the Ethiopian crash – pilots reportedly battled the system that pushed the nose of the plane down. “We have learned and are still learning from these accidents,” the Boeing CEO added, as quoted by CBS News. “We know we made mistakes and got some things wrong. We own that, and we are fixing them.”