• March 13, 2024

Boeing’s Woes Buzz the Airline Industry

Plus: All that high-tech driver assistance? Mostly useless. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

 
March 13, 2024

 

 

 

 

 

Good morning.

Maybe we had inflated expectations. 

On Tuesday, the latest government inflation report said that prices increased 3.2% in February compared to a year ago, slightly higher than most economists’ forecasts of a 3.1% rise. Many experts are now warning that the “last mile” of the Fed’s marathon to get inflation down to 2% from around 10% will be the hardest to complete. Perhaps some advice from marathon runners on mental tricks for finishing the race’s 26th mile will help: get competitive, focus on your goals, and remind yourself of the “after” of it all. In other words, when this is all over, we’re going out for pancakes with Jerome Powell.

 

 

INDUSTRIALS
Airlines Are Reeling From Boeing’s Frightening Series of Near-Disasters
Aerial photo of a United plane

Boeing is blowing the door off the airline industry.  

With the major airplane manufacturer experiencing headache after terrifying headache, the airlines that depend on its aircraft are reaching for the air sickness bags. Some of the industry’s biggest players have started warning investors of the spillover effects of Boeing’s woes, according to a Wall Street Journal feature published Tuesday.

Plane as Day

In the weeks since a mid-fuselage exit door blew off a 737 Max 9 Alaska Airlines aircraft shortly after takeoff, Boeing planes have seen: a tire fall off, crushing cars below; a fiery engine malfunction forcing an emergency landing in Houston; a case of “stuck rudder pedals” after landing; a landing gone awry, also in Houston; fumes filling the cabin, forcing a different emergency landing in Portland; and, on Monday, a “technical event during the flight which caused a strong movement,” resulting in an emergency landing and 50 injuries in Australia. And, oh, did we mention the sudden and shocking death this week of retired employee and longtime whistleblower John Barnett?

Also on Monday, The New York Times reported the troubling results found in a leaked copy of a six-week audit of Boeing’s production process for the 737 Max jet by the Federal Aviation Administration. And what’s bad for Boeing eventually trickles down to the poor suckers who have to, you know, actually fly the planes:

  • With regulators placing heavily increased scrutiny on Boeing’s production capacities, Southwest said Tuesday that it’s slashing flight capacity and re-evaluating its full-year guidance, saying it no longer expects to receive the nearly 30 MAX 7 jets that were expected to be delivered this year.
  • Alaska Airlines has said the three-week grounding of Boeing Max 9 jets has erased $150 million in company profit. United, meanwhile, has paused the hiring of new pilots and has begun shopping for new planes with Airbus to replace Boeing planes it no longer expects to receive. 

“This is not a 12-month issue. This is a two-decade issue,” United CEO Scott Kirby said at an investor conference on Tuesday. Southwest, which exclusively flies Boeing planes, saw its share price, ahem, freefall more than 15% on Tuesday.

Boeing’s Bad Audition: The FAA found Boeing failed 33 of 89 specific audits, for a total of 97 instances of alleged non-compliance. Inspectors also found mechanics at key supplier Spirit AeroSystems using makeshift tools like hotel room key cards and Dawn dish soap in the production process. In other words, your therapist may be overwhelmed for the next few months by a rush of new clients seeking treatment for sudden cases of extreme aerophobia.

 

 

AUTOS
Almost No One Makes a Good Driver Assistance System, Report Says

Your driver assistants are letting you down. 

A report released by the Insurance Institute for Highway Safety (IIHS) Tuesday examined the safety of 14 driver-assistance products from various automakers. The results were dismal: only one car, Toyota’s Lexus LS, notched an “acceptable” rating. The GMC Sierra and Nissan Ariya managed to nab “marginal” scores, while the rest — including driver-assistance poster child Tesla — were deemed “poor.” The report’s individual assessments were pretty withering, but potentially more damaging was the overall conclusion that driver-assistance systems do nothing to improve safety.

The Insurance Man Cometh

The IIHS’ main safety concerns stemmed from a lack of driver engagement. Driver-assistance systems can pretty much drive your car, but they’re not fully self-driving systems. Drivers need to be ready to take control of their vehicles at any time — and in the IIHS’ view, the systems themselves should enforce that level of engagement. “Many vehicles don’t adequately monitor whether the driver is looking at the road or prepared to take control,” Alexandra Mueller, a senior research scientist at the IIHS, said in a statement. “Many lack attention reminders that come soon enough and are forceful enough to rouse a driver whose mind is wandering,” she added.

This isn’t really a smoking gun, since automakers with driver-assistance systems can assert that it’s the driver’s responsibility to remain attentive. However, bullish automakers like to maintain that self-driving vehicles are in fact safer than those driven by fallible humans. The IIHS study hints otherwise: 

  • IIHS President David Harkey said in a statement that there is “little evidence [partial automation] makes driving safer,” and added: “As many high-profile crashes have illustrated, it can introduce new risks when systems lack the appropriate safeguards.”
  • Harkey told Reuters that his statement leaned on insurance claims data. “We have been able to look at vehicles with and without these (systems) and determine there is no reduction in claims as a result of these more advanced systems,” he said.

Lithium Lining: The IIHS wasn’t totally raining on automated driving’s parade; the report looked at how each system performed in a variety of criteria, and none were universally bad. “No single system did well across the board, but in each category at least one system performed well,” Starkey said in a statement. “That means the fixes are readily available and, in some cases, may be accomplished with nothing more than a simple software update.” The report was completed before Tesla’s most recent software update in December, so improvements may already have been made there. We hope, anyway.

 

 

ARTIFICIAL INTELLIGENCE
Google Won’t Let You Ask Gemini AI About Upcoming Elections

Ask me anything! But not that…

Google announced on Tuesday that Gemini, the generative AI chatbot formerly known as Bard, is being tweaked to restrict answers about elections taking place anywhere in the world this year. 

I Voted! (With No Help from AI)

This year is unprecedentedly election-heavy worldwide, and the fact that this coincides with the upsurge in generative AI use has raised plenty of legitimate concerns. Still, if Google doesn’t trust Gemini to give you answers about your local election it begs the question: What is Gemini for? When ChatGPT and its generative AI brethren first burst onto the scene, it was common to speculate the bots would be replacing traditional search engines, or at least offering an alternative. 

Google, which has the most to lose if search engines were to go obsolete, has embraced this idea and even developed a specialized AI-powered search engine for medical records. However, Google’s cautious approach to Gemini around elections suggests it doesn’t really think the technology is quite there yet — at least, not when intense media attention and bad PR are in the cards:

  • The chatbot won’t only stonewall questions about the elections themselves, but also queries about political parties, candidates, and politicians, according to TechCrunch.
  • TechCrunch said the tweak is already live in the US and India, which both hold elections this year, and will soon roll out to other countries.

Loose Lips Sink Censorships: It’s possible the move is aimed at avoiding any legal trouble in countries with more draconian freedom of speech laws. Last month, Google got into a contretent with the Indian government after a journalist asked Gemini whether Prime Minister Narendra Modi is a fascist. The chatbot answered that Modi has been: “accused of implementing policies some experts have characterized as fascist.” Nothing says “I’m not a fascist” like clamping down on any mention you might be a fascist.

 

 

Extra Upside
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