Boeing Outsourced Its 737 MAX Software To $9-Per-Hour Engineers

The software at the heart of the Boeing 737 MAX crisis was developed at a time when the company was laying off experienced engineers and replacing them with temporary workers making as little as $9 per hour, according to Bloomberg.

In an effort to cut costs, Boeing was relying on subcontractors making paltry wages to develop and test its software. Often times, these subcontractors would be from countries lacking a deep background in aerospace, like India.

Boeing had recent college graduates working for Indian software developer HCL Technologies Ltd. in a building across from Seattle’s Boeing Field, in flight test groups supporting the MAX. The coders from HCL designed to specifications set by Boeing but, according to Mark Rabin, a former Boeing software engineer, “it was controversial because it was far less efficient than Boeing engineers just writing the code.”

Rabin said: “…it took many rounds going back and forth because the code was not done correctly.”

In addition to cutting costs, the hiring of Indian companies may have landed Boeing orders for the Indian military and commercial aircraft, like a $22 billion order received in January 2017 . That order included 100 737 MAX 8 jets and was Boeing’s largest order ever from an Indian airline. India traditionally orders from Airbus.

HCL engineers helped develop and test the 737 MAX’s flight display software while employees from another Indian company, Cyient Ltd, handled the software for flight test equipment. In 2011, Boeing named Cyient, then known as Infotech, to a list of its “suppliers of the year”.

One HCL employee posted online: “Provided quick workaround to resolve production issue which resulted in not delaying flight test of 737-Max (delay in each flight test will cost very big amount for Boeing) .”

But Boeing says the company didn’t rely on engineers from HCL for the Maneuvering Characteristics Augmentation System, which was linked to both last October’s crash and March’s crash. The company also says it didn’t rely on Indian companies for the cockpit warning light issue that was disclosed after the crashes.

A Boeing spokesperson said: “Boeing has many decades of experience working with supplier/partners around the world. Our primary focus is on always ensuring that our products and services are safe, of the highest quality and comply with all applicable regulations.”

HCL, on the other hand, said: "HCL has a strong and long-standing business relationship with The Boeing Company, and we take pride in the work we do for all our customers. However, HCL does not comment on specific work we do for our customers. HCL is not associated with any ongoing issues with 737 Max.”

Recent simulator tests run by the FAA indicate that software issues on the 737 MAX run deeper than first thought. Engineers who worked on the plane, which Boeing started developing eight years ago, complained of pressure from managers to limit changes that might introduce extra time or cost.

Rick Ludtke, a former Boeing flight controls engineer laid off in 2017, said: “Boeing was doing all kinds of things, everything you can imagine, to reduce cost , including moving work from Puget Sound, because we’d become very expensive here. All that’s very understandable if you think of it from a business perspective. Slowly over time it appears that’s eroded the ability for Puget Sound designers to design.”

Rabin even recalled an incident where senior software engineers were told they weren’t needed because Boeing’s productions were mature. Rabin said: “I was shocked that in a room full of a couple hundred mostly senior engineers we were being told that we weren’t needed.”

Any given jetliner is made up of millions of parts and millions of lines of code. Boeing has often turned over large portions of the work to suppliers and subcontractors that follow its blueprints. But beginning in 2004 with the 787 Dreamliner, Boeing sought to increase profits by providing high-level specs and then asking suppliers to design more parts themselves.

Boeing also promised to invest $1.7 billion in Indian companies as a result of an $11 billion order in 2005 from Air India. This investment helped HCL and other software developers.

For the 787, HCL offered a price to Boeing that they couldn’t refuse, either: free. HCL “took no up-front payments on the 787 and only started collecting payments based on sales years later”.

Rockwell Collins won the MAX contract for cockpit displays and relied in part on HCL engineers and contract engineers from Cyient to test flight test equipment.

Charles LoveJoy, a former flight-test instrumentation design engineer at the company, said: “We did have our challenges with the India team. They met the requirements, per se, but you could do it better.”

6 Likes

I thought that capitalism ensures that things like this don’t happen! Oh, guess I was wrong about that. Boeing is really a company that needs to save a buck and cut corners. Their CEO has mouths to feed and needs to put shoes on his kid’s feet.

1 Like

I haven’t heard any news about Max for a while.
I think it wasn’t really a software problem (Not that the software was great) but a structural design problem.

Yeah, great “diversity” program at Boeing which ain’t going nowhere.

1 Like

And they are losing their credibility. Capitalism at work.

1 Like

Exactly. There are consequences to doing bad work. Not so in a leftist utopia where competition is deemed inefficient.

2 Likes

And here is the list of 18 competitors that will proliferate from this misstep.

1 Like

Boeing has been the benchmark in commercial aviation for a very Long time and for the most part was a leader in American ingenuity and the industrial face of American made! It wasn’t until a series of events happen where they began outsourcing to foreign entities. First was the liberal labor unions that drove up costs of its workforce second was losing military contracts to Lockheed and most recently to Grumman to design the new Generation 6 fighter jet, lastly rising costs associated with tech, materials and fuel.

Boeing should have been given national security status in order to protect its trade secrets, but instead went to China to outsource a large majority of their components. Also to add insult to injury, the Aluminium manufacturing industry was also under siege as a result of Chinese economic aggression and until recently there was only one Aluminium manufacturing plant in the US, and poses as a huge national security risk as Trump was correctly able to point out!

Boeing needs to fire their CEO and hire someone who sees the benefit of hiring competent American Engineers again instead of outsourcing to third world nations who are still trying to catch up to US standards in the Aero space industry, an industry no doubt that has been one of America’s prideful hallmarks of innovation!

I am hoping that this is a wake up call for Boeing to return home and get with the program of making America Great again, as clearly this huge blunder which I have no doubt could end costing the company millions to fix, is a lesson why Globalism is a very bad idea.

1 Like

Sometimes companies get orders from other countries but have “offset agreements” as part of the contract. Such agreements require the company to utilize a foreign source for services or production of parts.

I wonder if that is a factor here.

1 Like

True. but how does a company like Boeing arrive to the decision of hiring an Indian company to write code whose experience is light years behind other developed nations in this industry? This was a huge embarrassing mistake for Boeing in which it’s reputation is going to take a big hit and a long time to recover from.

1 Like

It’s long been a practice to outsource crapcodes to other countries, since these work can be delivered remotely, and hard to be inspected for “quality”, especially if said foreign firms also do the quality inspection.

Not sure I buy that. Boeing has the ability to run the software through their own modeling programs and simulators to see if it will perform as desired.

If for some reason they can’t they have just opened themselves up to a massive class action lawsuit for gross negligence and treble damages for same.

In other companies yeah, but we are talking about Boeing here, a world leader in commercial Aviation not some company manufacturing consumer products that needs to outsource in order to hit their profit margins where such an error in hiring inferior engineers could cost hundreds of lives.

…if it hasn’t happened already.

1 Like

Good point! As I purposely left out what prompted this issue of the 737 to be grounded in the first place to only focus on the problem. Boeing has a huge mess on their hands that is under pressure from class action suits file already in the deaths of two recent crashes that will probably will be settled or tied up in the courts for a number of years!

How? One should ask “who”.

Program managers and software managers with bad bad judgement. And directors who have bad judgement about who to promote to management.

A more in depth look at Boeing’s spotty safety record in recent years leads to more questions. One such highlight of this article is the US Airforce cancelling its order for the tankers after finding leftover tools by workers in various parts of the planes wings! This seems to suggest that the buck stops with the CEO of the company and mismanagement and the myriad of problems that is ultimately damaging the company’s long term credibility! Not good!

Well as you know it starts at the TOP and works it’s way down! People need to lose their jobs over this, starting with the CEO and if I was on the board of directors that is exactly what I would be demanding! This is outrageous!

Screw Boing. I left McDonnell when I saw this coming.

CAS avionics is flight critical, can’t offshore that.

Flight Control is not some damned app that works most of the time.

Speaking of McDonnell, that is the same company that was part of Douglas? I find it ironic that is was Boeing in the earliest stages of development of commercial aviation that they dropped the ball to when Douglas created the DC-3 probably the most reliable airplane ever made! Boeing had a similar design but scrapped its development!

Well, there goes the safety reputation of the crown jewels of American industry, but who cares as long as you saved shareholders a couple bucks this quarter.