Boeing said in a statement Monday that the function wasn't working on some of its planes because it was mistakenly linked to an optional feature, the angle of attack (AOA) indicator.
"The disagree alert was intended to be a standard, standalone feature on MAX airplanes. However, the disagree alert was not operable on all airplanes because the feature was not activated as intended," it said. "Unless an airline opted for the angle of attack indicator, the disagree alert was not operable."
The AOA indicator lets pilots know whether one of the AOA sensors is not working. The "disagree alert" shows if the sensors contradict each other. Boeing said the alert function was not necessary for the safe operation of the airplane.
Boeing (BA) has been battling rising public concern and pressure from shareholders over the safety of its best-selling jet after two of the planes crashed in six months. In October, a Lion Air plane crashed in Indonesia, killing all 189 people on board. An Ethiopian Airlines plane crashed under similar circumstances in March, leaving 157 people dead.
Some of Boeing's customers say the company wasn't as transparent as it should have been about the alert system.
Southwest Airlines (LUV), the largest US operator of 737 Max planes, said in a statement on Monday it had only learned that the system was optional after the Lion Air tragedy in October.
"Prior to the Lion Air event, the AOA disagree lights were depicted as operable (not optional) by Boeing on all Max aircraft," Southwest spokeswoman Michelle Agnew said.
Boeing defended its practices on Monday.
"On every airplane delivered to our customers, including the Max, all flight data and information needed to safely operate the aircraft is provided in the flight deck and on the flight deck display," it said.
But the statement marks the first time the company has admitted a mistake in the rollout of its 737 Max.
At its shareholder meeting earlier on Monday, Chief Executive Dennis Muilenburg said that the safety systems on the 737 Max were properly designed.
"We haven't seen a technical slip or gaffe in terms of the fundamental design and certification of the approach," he said.
He also suggested that in both fatal crashes, pilots did not "completely" follow the procedures that Boeing had outlined to prevent malfunction.
Boeing declined to comment further on the matter.
The company has said it will continue working to make its planes safer. Last month it deployed a software overhaul for the 737 Max aircraft that involved an upgrade to MCAS, the anti-stall system that has been identified as a common link in both crashes.
The most significant change to the MCAS software in that update is the addition of data from a second AOA sensor, which measures the horizontal tilt of the airplane. In its first iteration, the software only drew data from one AOA sensor.
Investigators in Indonesia have said that faulty data from a single sensor caused the MCAS system to repeatedly push the Lion Air flight down towards the ocean, in a battle with the pilots who tried to right the plane.
Boeing says it will ensure that the "disagree alert" system is operable on all 737 Max planes.
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