Skip to Content

4 Takeaways from Boeing’s Congressional Grilling

In the first of a series of grillings on Boeing’s grounded 737 MAX, Daniel Elwell, acting administrator of the FAA, along with National Transportation Safety Board Chairman Robert Sumwalt, testified before the House Aviation Subcommittee on Wednesday, the latest in a round of inquiries and investigations surrounding Boeing’s 737 MAX. The safety of the aircraft has come under intense scrutiny in the wake of two crashes taking the lives of all 346 people on board.

And safety, according to Representative Rick Larsen, a Democrat from Washington and chairman of the House Aviation Subcommittee, underpins the entire industry: “If the public does not feel safe about flying, then they won’t fly. If they don’t fly, airlines don’t need to buy airplanes. If they don’t need to buy airplanes, then airplanes don’t need to be built. And if there’s no need to build airplanes, we don’t need jobs in aviation. Therefore, it is very clear, that the foundation of the U.S. aviation system is safety,” he said in his opening statement.

The three-hour hearing was held to start producing answers on how the FAA certified the safety of the 737 MAX. So far, requested information from Boeing has not been forthcoming, noted Transportation and Infrastructure Committee Chairman Representative Peter DeFazio, a Democrat from Oregon who opened his statement by saying that Boeing has yet to turn over a single document as requested by the committee.

Here were the four biggest takeaways:

Boeing should have been quicker to report a flaw in the software

Earlier this month Boeing revealed to the public that they discovered a software malfunction a year before the Lion Air crash. After review, company experts concluded “the existing functionality was acceptable until the alert and the indicator could be delinked in the next planned display system software update.” The FAA wasn’t told until after the Lion Air crash. “I am not happy with a 13-month gap between finding that anomaly and us finding out about it,” Elwell said. “We are looking into that and we will make sure that software anomalies are reported more quickly.”

Boeing has been working on an MCAS software update for the 737 MAX that will address the malfunction. Elwell indicated that the application for the update should be forthcoming in the next week or so, which puts Boeing a step closer to getting its planes in the air. Management at Boeing, according to an investor note from Morgan Stanley, have found a “degree of optimism” as talks with customers and regulators proceed around getting the 737 MAX flying again, “which could potentially occur over the coming months.”

Boeing did a poor job communicating with pilots

It seems like a given. But since MCAS was only supposed to kick in during extreme situations, Boeing didn’t include it in the pilot manual, and so Lion Air pilots didn’t know about it—let alone the possibility of malfunction. It was a fact that surprised Elwell, a former pilot: “I, as a pilot, When I first heard about this, I thought there should have been more text in the manual about MCAS,” he said in response to a question from Transportation and Infrastructure Committee Chairman Representative Peter DeFazio, a Democrat from Oregon.

Boeing will still have plenty of authority in the certification process

Elwell faced tough questions around the certification process that critics say delegates too much authority to Boeing. He defended the Organization Designation Authorization program called ODA which allows aircraft manufacturers to designate “authorized representatives” or ARs. These people, on the payroll of the company, can, for instance, approve certain decisions in products. The problem, critics of the system charge, is that ARs can be subject to conflict-of-interest or undue pressure from a company manager.

“We’ve had ODA in one form or another since the beginning of the FAA. We’ve had delegation of authority since 1927,” said Elwell. “Just because it has evolved since 1927 doesn’t mean it’s evolved to the place where it needs to be or should be,” Larsen countered. “And perhaps it’s over-evolved in this case.”

Pilot training must improve

Boeing CEO Dennis Muilenburg has previously mentioned erroneous readings as a link in a “chain of events” that led to the crashes. And during the hearing, Ranking Member Sam Graves, a Republican from Missouri, who expressed concern about tearing down the U.S. system based on what happened in other countries, bolstered that view by raising questions about pilot errors in the crashes and their levels of experience.

“The most important safety feature you can have in any aircraft is a well-trained pilot that can fly the aircraft,” he said. He added: “For me the accident report reaffirms my belief that pilots trained in the United States would have successfully been able to handle this situation. The reports compound my concerns about quality training standards in other countries.”

Michel Merluzeau, Aerospace and Defense Analyst with research firm AIR, believes the systems on an aircraft needs to be designed for pilots of all experience levels. With the rise of the middle class in Asia and their desire to travel, there is a need for more pilots, he says. “With the number of new pilots we’re getting, especially out of Asia, it is absolutely essential that we do not gauge what needs to be done based on the experience of a given country,” he says. “You need to adjust the systems to maintain the levels of very high safety standards that we’ve had for decades.”

On the pilot training and error front, NTSB Chairman Sumwalt placed the responsibility firmly on Boeing: “If an aircraft manufacturer is going to sell airplanes all across the globe, then it’s important that pilots who are operating those airplanes in those parts of the globe know how to operate them,” he said. “Just to say that the U.S. standards are very good and this might be a problem with other parts of the globe, I don’t think that’s part of the answer. I hate to use this term, but the airplane has to be trained to the lowest common denominator.”

More must-read stories from Fortune:

—Warren Buffett’s best stock picks over the past year

—How Tumblr’s trouble illustrates Verizon’s messy media strategy

“Staggered” boards are paying off for stock investors

—Why “debt ceiling” may become a buzzword this summer

Don’t miss the daily Term Sheet, Fortune‘s newsletter on deals and dealmakers.