Air Freight News

Boeing’s DC powerbroker rebuilds clout after fallout from 737 Max crash

Boeing Co.’s rainmaker in Washington, a former auto lobbyist who goes by the nickname “Z,” is restoring some of the swagger that once made the aerospace giant a force on Capitol Hill.

A badly needed legislative victory in late December let Boeing continue plans for its cash-cow 737 Max over the protests of family members of victims of two fatal crashes. Now Ziad Ojakli, 55, has his sights set on the White House, where Boeing needs support to re-establish sales of the plane in China.

Reopening China and restoring the aviation giant’s political clout would help cement a turnaround under Boeing Chief Executive Officer Dave Calhoun after years in the DC doghouse. The planemaker shifted its headquarters within eyeshot of the Pentagon last year, citing a need to foster better relations with the US government. Boeing has stumbled badly on defense contracts as well as with commercial aviation regulators, and its executives endured a bipartisan shellacking on Capitol Hill over the Max crashes in 2018 and 2019.   

“Everything legislatively was easier before the two crashes and pandemic,” said Loren Thompson, a defense consultant executive and long-time DC observer. “In terms of their business, this is doubly important to Boeing right now because it has lost ground to Airbus on the commercial side and its defense operations are performing weakly.”

Ojakli has faced a steep learning curve since joining Boeing in October 2021 as executive vice-president of government operations. The aviation titan’s political sway has been dented from years of internal and external turmoil. And its famously plugged-in DC operations were hamstrung by a wave of departures soon after he arrived.

He’s filled several dozen empty posts and worked his connections from previous jobs leading government affairs for Ford Motor Co. and SoftBank Group Corp. Less than a year after joining Boeing, Ojakli was ranked as one of Washington’s top corporate lobbyists for 2022 by The Hill, a Beltway trade publication. He’s prominent in civic circles, serving as chairman of the board for National Zoo.

Those who know Ojakli say he’s congenial, the kind of person who’s quick to throw an arm around people he knows. But he keeps a low profile in the media and declined a request for an interview. A former boss, retired Ford CEO Alan Mulally, praises his “positive find-a-way mindset.”

The consummate Beltway insider discussed his philosophy for winning friends in high places in a 2013 interview conducted as part of the Presidential Oral History Program by the Miller Center at the University of Virginia. 

“You try to get inside the head of, say, the senator, walk a mile in their shoes,” Ojakli was quoted as saying in the transcript. “You have to be there over time and become the trusted source. You have to give the senator or congressman both sides of the issue.”

Promising Sign

For the first time in years, Boeing has a chance to make headway on Max sales and deliveries to China as the two superpowers search for common ground. US Secretary of State Antony Blinken is planning to visit Beijing early next month, potentially followed by Chinese President Xi Jinping traveling to the US in November to attend an APEC leaders summit. In one promising sign, a state-controlled Chinese airline flew a 737 Max passenger jet on Jan. 13 — the first such flight by a domestic airline in nearly four years. 

While the company has the attention of senior White House officials as one of the largest US exporters, its concerns in China compete with President Joe Biden’s other priorities, like tensions over Taiwan and steps to disentangle the world’s two largest economies. 

“Boeing is a very important stakeholder. But Boeing on its own doesn’t determine our trade policy,” US Trade Representative Katherine Tai told Bloomberg in October.

China’s tilt to Airbus SE in recent years has been costly for the US titan, which delivered just eight planes to the Asian nation last year compared to 117 for its European rival. In US-China talks, Biden’s team has tended to focus on Chinese economic practices that disadvantage many American companies, rather than pressing for specific concessions for Boeing.

But that could be changing. Behind the scenes, senior Boeing executives talk regularly with White House Chief of Staff Ron Klain and have found Commerce Secretary Gina Raimondo sympathetic on trade issues, said two people familiar with the matter. Boeing CEO Calhoun and his wife were invited to Biden’s first state dinner in December.

Those kinds of relationships could provide critical for a breakthrough on China, which will need to stock up on Boeing’s 737s to meet a post-lockdown surge in travel, predicts aviation consultant Richard Aboulafia. The planemaker’s prospects in its largest overseas market will be a focal point for investors on Jan. 25 when it reports earnings.

Decades of Experience

The lobbyist’s ties to Washington date back decades to his years at Georgetown University, from which the Brooklyn native graduated with a degree in American government studies in 1989. He learned how political deals came together as an aide to several Republican lawmakers, and later corralled Senate votes for the White House during former President George W. Bush’s first term in office.

At Boeing, Ojakli followed in the wake of Tim Keating, a former White House aide to Democratic President Bill Clinton who commanded influence on Capitol Hill and within Boeing. Longtime hands were shocked by Keating’s abrupt exit in June 2021 — so swift that the 13-year veteran didn’t have time for farewells. Several of his top deputies followed soon thereafter, notably four senior lobbyists who jumped to defense contractor Raytheon Technologies Corp.

Ojakli has tapped contacts from the auto industry and government to rebuild Boeing’s lobbying chops, including Nicole Nason, a former administrator with the Federal Highway Administration. She oversees legislative strategy for commercial aviation.

He also borrowed a management tool from his years at Ford: Every Monday afternoon Ojakli hosts sessions similar to the business plan reviews that were a hallmark of Mulally, the former Boeing commercial chief who later ran the automaker. Progress on strategic priorities is coded with stop-light colors to show varying levels of urgency, according to people familiar with the matter. 

A Staunch Critic

In convincing lawmakers to exempt the final two Max models from a late 2022 deadline, the chief lobbyist’s task was “hugely complicated,” Aboulafia said. He faced a widespread perception Boeing was too cozy with regulators and opposition from the likes of Representative Peter DeFazio. The Oregon Democrat was such a staunch critic of Boeing that a portrait commissioned ahead of his 2022 retirement included a copy of the scathing report from an investigation that he’d led into the Max crashes.  

Boeing would not comment on its lobbying campaign for the extension.

The Max measure had stalled in earlier attempts, but top congressional leaders tucked it into a late-year spending bill after a nudge from the White House, said a person familiar with the actions. A close reading of a 2020 law mandating flight-deck changes in the Max certified after Dec. 27 showed it likely wouldn’t have required the sweeping redesign sought by DeFazio and the crash victims’ families, said the person. 

That made it harder to argue the provision was a safety game changer, but not to the liking of all. 

“This change in the law was without hearings or data, and was a dark of night move by the swamp,” said Michael Stumo, whose daughter perished in a Max accident in Ethiopia. “A crash every three years is possible if the historic pattern continues,” he added.

A late lobbying push from Boeing’s two largest unions was also crucial. In December letters to Biden and other key Democrats, labor leaders endorsed a compromise drafted by Washington Senator Maria Cantwell that required other safety enhancements be made to all Max models.

“We did make sure that the White House is aware and understands why this is significant not just for our members, but the national economy,” said Faraz Khan, legislative director for a union representing Boeing’s engineers. 

For Ojakli and Boeing, it could represent a turning point in DC — or what he called “the law of averages” in the oral history interview.

“You kept being respectful and listening to them and to their concerns and at some point you might get lucky.”

Bloomberg
Bloomberg

{afn_job_title}

© Bloomberg
The author’s opinion are not necessarily the opinions of the American Journal of Transportation (AJOT).

Similar Stories

Flood damage at Auckland Airport halts international flights

New Zealand’s biggest airport delayed the reopening of its international terminal Saturday because “critical components” of the infrastructure were damaged by severe flooding after a sudden summer storm.

View Article
Italy starts talks with Lufthansa to sell minority stake of ITA

Italy initiated talks with Deutsche Lufthansa AG to sell a minority stake of ITA Airways, the successor of Alitalia SpA, in a move that may kick off aviation industry consolidation…

View Article
Alaska Air CEO says Silicon Valley business travel has dried up

The head of Alaska Airlines says Silicon Valley technology companies have “turned off” their business travel, and it could be as much as another year before they start booking trips…

View Article
https://www.ajot.com/images/uploads/article/WFS_Cargo_at_Paris_CDG_.jpg
Zongteng Group chooses WFS for Boeing 777F freighter flights as e-Commerce cargo boosts
View Article
Boeing-DOJ ‘sweetheart deal’ decried by victim’s wife

Naoise Connolly Ryan told a Texas judge she’s refused any of the $500 million Boeing Co. was required to set aside to compensate families of 737 Max crash victims under…

View Article
Auckland Airport halts domestic, international flights on floods

Auckland Airport said it would halt domestic and international flights until noon on Saturday after New Zealand’s biggest city was hit by incessant rain that flooded the terminal buildings.

View Article