FAA delegates aircraft certification to Boeing. And yet they recorded the best safety record ever

The last time we’ve seen Boeing in the news this much, it was 2013. It was the first year of service for the Boeing 787 Dreamliner. Its battery overheated and caught fire. Consequently, all Boeing 787s were grounded. But the current situation with the 737 MAX is much worse. I won’t go through details that you can find on any major news outlet. Rather, I want to add some color to Boeing’s relationship with the FAA and its relation to the recent accidents.

FAA allows Boeing to certify parts of its own aircraft

Earlier this week, the Wall Street Journal published an article titled, “Fast-Tracked Aircraft Certification, Pushed by Boeing, Comes Under the Spotlight.” Similarly, the New York Times published an article titled, “After Boeing Crashes, Sharp Questions About Industry Regulating Itself.”

Long story short, per the Organization Designation Authorization program, established in 2005, the FAA is allowed to delegate many aspects of aircraft safety certification to the OEM. In other words, the FAA allows Boeing to certify parts of its own aircraft. New technology certification still falls to the FAA but known technologies, Boeing can certify itself.

… Yes, a little suspect. It’s not hard to see the misalignment of incentives: a Boeing employee is paid by Boeing to certify a Boeing aircraft. The employee is told safety is a top priority but is also told the deadline is X and budget and Y. As a result of the recent 737 MAX crashes, a special Department of Transportation committee will review the FAA’s safety approval process. Before I share my opinion, a few disclaimers.

Disclaimer: Opinions are my own and do not reflect the views of my employer. From 2012 to 2017, I was an aerodynamics engineer at Boeing. I never worked on the 737 MAX, I worked solely on the 777–9 aircraft but I knew many people who worked on the 737 MAX. Some of my opinions are based on observations and experiences from my time at Boeing.

My opinion: I disagree with the critics that say Boeing certifying its own aircraft is a problem. Boeing’s arrangement with the FAA will not change, nor do I think it should change. This system led to the boom of the aviation industry, all the while maintaining the best safety record.

Who at Boeing is allowed to certify its aircraft?

The FAA calls them Individual Designees. Internal at Boeing, they are known as Engineering Unit Member (E-UM).

The qualification process is extensive. Say you want to be a Designated Engineering Representative. Your application includes a cover letter, statement of qualifications, and 11 technical evaluations:

Acoustical + Electrical Systems & Equipment + Engine + Mechanical Systems & Equipment + Propeller + Flight Analyst + Power Plant + Flight Test Pilot + Radio + Structural + General Regulatory & Technical

There are 11 unique designees, each with a unique set of training and testing material. All designees need to be familiar with sections of the Code of Federal Regulation related to their task. The FAA is very transparent; here’s the link to that mind numbing doc.

Engineering Unit Member to Boeing liken Equity Research to Investment Banking

The Professional Aviation Safety Specialists (PASS) organization is a vocal critic of the FAA’s Individual Designee program. In 2004, PASS wrote to the agency:

“Allowing the aviation industry to self-regulate in this manner is nothing more than the blatant outsourcing of inspector functions and handing over inherently governmental oversight activities to non-governmental, for-profit entities,”

It’s a fair argument. However, a similar relationship works in the financial services world. Authorized Representatives to Boeing is analogous with equity research to investment banking. Yes, I recognize that doesn’t paint a pretty picture but it works.

In the wake of the dotcom bust, regulators discovered that big-name analysts were pressured into giving stock “buy” ratings, often against research that suggested otherwise. Regulators also found these analysts personally owned pre-IPO shares of the securities, providing a financial incentive to give the company a high rating as they stood to profit from the listing. To rectify the issue, NASD and NYSE implemented new legislation that forced banks to separate their research and investment banking division. Both organizations reside under the same parent company, but with a strict Chinese Wall separating the two.

It’s not exactly the same but it’s comparable with Engineering Unit Members’ relationship to Boeing. It’s not perfect, but it works. Financial services firms put a Chinese Wall to separate equity research and investment banking. The FAA expect E-UM to act on behalf of the FAA and expects Boeing to treat the E-UM as FAA representatives.

Track record: the system works

The FAA’s Individual Designee program is quite large. A few interesting factoids.

• Individual Designees performed more than 90% of tasks involved with certification (2013 Government Accountability Office report).
• The FAA had a 40-person office dedicated to overseeing the Organization Designation Authorization program (2015 Transportation Department inspector general report).
• FAA had 1,571 designees for aircraft certification services (FAA fact book, fiscal year 2016).

The FAA and Boeing relationship is deeply intertwined. Boeing is able to certify and deliver airplanes at the rate they do because of this system.

Despite the complex system, commercial air travel is the safest mode of transportation in the world. In 2017, there were zero deaths related to commercial passenger jet accidents around the world. From 2009 to 2018, for nine-years, US airliners recorded zero deaths. That’s an impeccable safety record. Compared to 1.3 million deaths in road crashes each year.

Engineering Unit Managers in action

I knew several E-UM at Boeing. During my time there, I saw E-UM treated with the highest levels of respect. Their voice carried a lot of weight in meetings and management recognized their position on safety. They would place an “Engineering Unit Member” tag next to their desk so anyone could find them. Their expertise was highly sought after.

Boeing does not take this program lightly. In 2005, Ray Conner testified to the House Transportation Committee. Ray Conner was the then CEO of Boeing’s commercial airplane organization. He said, “These people are essentially the arm of the FAA. Although they are paid by us, they are within our organization, they are approved individually by the FAA. They carry the FAA authority, in essence. And we take that very, very seriously.”

I don’t believe anything improper happened during certification, such as the E-UM intentionally certifying an unsafe airplane. One of the E-UM is a good friend and mentor. In the five years that I worked with him, there was never a single instance where I questioned his commitment to safety and engineering quality. When managers wanted to expedite the schedule, I saw him push back due to safety concerns. And the managers respected his position.

I can confidently say that the Boeing E-UM act with integrity and prioritized safety above all, even against the pressures of budget and schedule. And Boeing managers respect the authority and burden that E-UM carry.

Jeff Guzzetti, former assistant inspector general for aviation audits, had said the program “probably still has issues. In general, the system works. No one is more motivated to have a safe aircraft than the manufacturer, because if one crashes, it could be the end of that manufacturer, it could cost billions of dollars — just like it’s costing Boeing.”