Emirates is the largest buyer of Boeing's 777X jet, whose delivery is expected in 2025 or 2026. AFP
Emirates is the largest buyer of Boeing's 777X jet, whose delivery is expected in 2025 or 2026. AFP
Emirates is the largest buyer of Boeing's 777X jet, whose delivery is expected in 2025 or 2026. AFP
Emirates is the largest buyer of Boeing's 777X jet, whose delivery is expected in 2025 or 2026. AFP

Emirates calls for changes at Boeing as FAA demands improved safety plan


Shweta Jain
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Emirates airline president Tim Clark has called for changes at Boeing after a series of technical snags in the past couple of months brought the regulatory focus back on the US plane maker.

Boeing has been given 90 days by the US Federal Aviation Administration to come up with a plan to improve quality and meet safety standards after the blowout of a door panel on one of its 737 Max planes in January.

FAA administrator Mike Whitaker told Boeing on Wednesday that he expects it to provide the FAA with a comprehensive action plan within three months that will incorporate the coming results of the FAA production-line audit and the latest findings from an expert panel report.

The FAA believes there was a “disconnect between the management and the safety system”, Reuters cited Mr Clark as saying at an event at the UK Aviation Club on Thursday.

Emirates airline president Tim Clark. Reuters
Emirates airline president Tim Clark. Reuters

“All this is something that some of us have been saying for a long time,” he said.

He also hinted at delivery delays for the first Boeing 777X jet.

“The 777X [delivery] is probably at the back end of next year and maybe 2026, if we’re unlucky,” Mr Clark said, as quoted by the newswire.

Dubai-based Emirates is the largest buyer of the roughly 400-seater aircraft, with a total of 205 Boeing 777X jets on order. While the aircraft was originally due to be delivered in 2020, Boeing expects to make its first delivery in 2025.

Mr Clark said at the Dubai Airshow in November that the first handover of the first 777X-9 aircraft for Emirates was scheduled for October 2025 while handovers of the 777X-8 were due to begin in 2030.

The airline placed an order for 95 additional Boeing 777X planes ­– the world’s largest twin-engine jets – along with 787 Dreamliners, valued at $52 billion at list prices, as part of plans to replace ageing aircraft and further expand its fleet.

"Emirates has already experienced several years of delays with the 777-9 and depends on it both for fleet renewal and growth," John Strickland, an aviation consultant with JLS Consulting, told The National.

"It is equally important in keeping average aircraft capacity at a higher level in the years ahead as the airline looks to retirement of its A380 fleet into the 2030’s. Any further delay into 2026 will require some re-planning of its schedules and capacity for the affected period."

Boeing has been scrambling to explain how the door plug on a brand new Alaska Airlines 737 Max 9 blew out during flight.

The head of plane maker's 737 Max programme, Ed Clark, left the company last month amid intense scrutiny around production and safety measures following the January 5 incident, which led to the FAA grounding the Max 9 for several weeks.

Mr Clark, who had been with the plane maker for about 18 years, departed as Boeing vowed to improve production quality.

A previous crisis over fatal crashes in 2019 also led to a 20-month grounding of the Max aircraft, slowing certification of future planes, including the 777X.

The panel that flew off the Alaska Airlines jet appeared to be missing four key bolts, according to a preliminary report from the US National Safety Transportation Board in early February.

“Boeing must commit to real and profound improvements,” Mr Whitaker said this week, following the meeting with Boeing chief executive and president Dave Calhoun and his senior safety team.

“Making foundational change will require a sustained effort from Boeing’s leadership, and we are going to hold them accountable every step of the way, with mutually understood milestones and expectations,” he said.

“Boeing must take a fresh look at every aspect of their quality control process and ensure that safety is the company’s guiding principle.”

The US plane maker “really needs to do this”, said Emirates airline’s Mr Clark said in London. “Whether this means a change in the governance model, I don’t know. When you change the governance model, it invariably involves changing the people around the old governance model,” he said.

Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

Updated: March 01, 2024, 12:19 PM