Boeing MCAS Flight System At Fault In Lion Air Crash, Indonesia Says

Despite soaring on dismal earnings today, Boeing shares are down more than 10% in the last few days, its top executive for the commercial airplanes division was booted on Tuesday afternoon, and now, Indonesian investigators have just told victims' families of the doomed Lion Air 737 Max jet that crashed last Oct. the truth: major mechanical and design problems with a flight control system were responsible for the crash.

Indonesian investigators told victims' families Wednesday that the major contributing factor to the Lion Air crash, which killed 189 people, was due to an anti-stall device called the Maneuvering Characteristics Augmentation System (MCAS), reported Reuters. 

In a presentation to victims' families, the National Transportation Safety Committee (NTSC), an Indonesian government agency charged with the investigation of plane accidents, said MCAS' reliance on a single angle-of-attack sensor made it at risk in producing false readings. Investigators told the families that the certification process of the 737 Max with FAA officials was questionable.

Reuters noted that NTSC would publish the final report on Friday. The findings could offer more damaging insight into Boeing's top-selling plane and perhaps lead to a much longer grounding. The 737 Max has been grounded since early March, costing the company nearly $8 billion. Boeing is expected to report 3Q earnings on Wednesday. 

Boeing is under intense pressure after a Reuters report on Tuesday revealed how the faulty MCAS on Max planes was well known before the aircraft entered service.

Officials at the troubled US aircraft manufacturer have said it would redesign MCAS to rely on several sensors rather than one.

Satyendra Pandey, a New Delhi-based analyst and former head of strategy at Go Airlines India, told Bloomberg that NTSC's findings so far suggest that Boeing has a significant design flaw with the plane.

"Going back to revisit the design itself has tremendous ramifications for Boeing - both in terms of cost and liability," Pandey said. "It can be assumed that Boeing will contest this and point to software as the flaw."

As shown in the graphic below, the MCAS system pushes the plane's nose downward upon sensing a stall. 

Sources told Reuters that Boeing settled the first round of claims with families from the Lion Air Crash. Sources said each family is likely to receive $1.2 million.  

Boeing also faces more than 100 lawsuits over the Ethiopian Airlines 737 Max crash in March, which killed 157 people, and so far, authorities are blaming a malfunctioning MCAS for that crash as well.