Since the second fatal 737 Max crash, in Ethiopia in March, and the subsequent worldwide grounding of the jet, Boeing has suffered a precipitous fall.
Ongoing investigations of the crashes have spotlighted the badly flawed design of the Max's flight control system and a largely self-certifying oversight regime that failed to catch the flaws. Congressional investigators are combing internal Boeing documents for evidence of malpractice, and a Department of Justice probe means even a criminal indictment is not ruled out. The jetmaker's stellar global reputation is badly tarnished.
Through it all, said Richard Aboulafia, vice president of analysis at aviation consulting firm Teal Group, Boeing has displayed "an absence of leadership, an absence of strategy and an inability to communicate."
The disastrous year will be followed by a precarious 2020: As Boeing's new leaders struggle to recover control, they face critical decisions about developing new airplanes while they cope with depleted financial resources, a distracted engineering corps and a loss of Boeing's previous strategic advantage against rival Airbus. They will also face pressure to reverse a two-decadeslong decline in the company's historic culture of engineering prowess, which many blame for the Max disaster.
Although newly ousted CEO Dennis Muilenburg was an engineer, he stuck closely to the financial engineering playbook of his predecessor, Jim McNerney. Whistleblowers and leaked documents have raised damaging accusations that management drove too relentlessly to cut costs and deliver on schedule.
A former senior leader at Boeing, who asked for anonymity to speak freely, blamed the Max crisis on a "push away from engineering excellence, driven by cost-cutting."
"All of us who care about Boeing, we want to learn from this and ensure it never happens again," the former executive said. "We have to get back the engineering discipline and make it the No. 1 priority."
Boeing's proposed fix for the Max — making sure the flight-control system that went haywire in the crashes has multiple redundancies — in concept is solid.
In practice, it's taking much longer than anticipated to ensure the software is bug-free and hides no pathways to another single-fault failure.
It looks like the grounding of the Max will stretch into a full year. Yet no serious industry analyst doubts that the Max eventually will fly again and that when it does, it will be a safe airplane.
Aboulafia believes Boeing must not only steady itself by fixing the Max and restarting production but then must follow up as soon as practical to secure its future by launching an all-new airplane.
Adam Pilarski, senior vice president at consulting firm Avitas, points to the recurring cycles in the aviation industry.
Though both Airbus and Boeing have suffered major setbacks over the years, the two aerospace giants still divide the business in a powerful duopoly and neither can feed the demand for new jets alone.
Pilarski is optimistic that despite the debacle of 2019, Boeing will reverse its fortunes.
"In the long run, aviation is not dead. Boeing is not dead," he said. "Eventually, Boeing can recover its strategic position."
As 2019 ends, Boeing is paralyzed by the Max crisis.
After months of optimistic declarations that the Max fix was close to approval, the FAA pricked that bubble in December when FAA boss Steve Dickson told Muilenburg to get real.
In response, Boeing finally announced a complete halt to the 737 Max assembly line until further notice. The board fired Muilenburg shortly after and appointed company Chairman Dave Calhoun to take over as CEO.
"Right now, there is a fire and they have to put it out," said Pilarski, of Avitas.
Now Boeing must wait for FAA clearance while it braces for compensation negotiations with suppliers and airline customers.
Its leverage is limited: Boeing needs its suppliers to maintain capacity to restart and ramp up production again. It needs airlines to keep their Max orders.
Yet Boeing faces hostility from all quarters.
It had already alienated many of its suppliers long before the crashes, as it relentlessly pressed them to lower their prices. Boeing's airline customers, strung along for months, have lost patience. U.S. pilot unions have displayed open anger at Boeing.
On top of this, when the FAA finally gives the Max the OK to fly — late February or early March is the new target — it will be a daunting logistical challenge to restart the global supply chain and perform the maintenance needed to get the backlog of parked airplanes back in the air and delivered.
Aboulafia, of the Teal Group, worries that the Max crisis will leave Boeing incapable of taking steps essential to its future, in particular responding to the new market demand for midsize, midrange, single-aisle planes for international routes — jets like the Airbus A321neo.
He said "an arms race" by airlines to re-equip their fleets with these new airplanes is already underway. In December, United Airlines said it will buy 50 new A321XLRs, the extra-long-range version, to replace its aging Boeing 757 fleet.
"This is exactly the moment that Boeing needs to invest in its future," said Aboulafia. "There will be a wave to catch. People want a new jetliner. You prepare for the wave and you catch it."
He believes Boeing should drop the twin-aisle NMA concept and instead go for a replacement to the Max that skews toward the larger end of the single-aisle segment, the A321neo's size.
Without the crashes, he thinks Boeing could have "turned on a dime" to pivot toward that idea.
Now, with cash squeezed and debt mounting, he fears the Boeing board won't make the necessary investment and will lose that market completely to Airbus.
Yet the best Boeing strategy is not obvious.
Pilarksi agrees that Boeing needs to catch that next wave. But he still sees the NMA concept as Boeing's best answer to the A321neo.
The NMA plan includes new, innovative production technology that he thinks Boeing should apply to a Max replacement only some years later.
Whatever strategy is chosen, he said that as it emerges from the Max crisis, Boeing needs to "tell the market that it is not out of business."
"They need a moonshot," said Pilarski. "They better start working on it. I'm sure they are."
Sometime in the new year, Boeing hopes for its first good-news event in many months: the long-delayed first flight of the new 777X, with its massive composite wings.
In late January, Boeing's new leadership will reveal the latest tally of the cost of the Max grounding, updating the $9.2 billion estimate through October.
The rest of the year is likely to be a long slog, getting the Max program restarted and slowly ramping back up again. No one can yet foresee the long-term effect.
