Word: faa
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Dates: during 1990-1999
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...crash has shed light on some classic failures in the FAA's handling of low-cost carriers. For starters, after the ValuJet tragedy, Hinson and Pena trumpeted the airline's safety record--statements that began to seem increasingly surreal as inspection reports started popping up, showing ValuJet had committed enough infractions to merit grounding months ago. A number of FAA inspectors told TIME they sent regional offices and headquarters critical reports that were ignored. There is talk of a criminal investigation. And though the agency was concerned enough about ValuJet earlier this year to run a special review...
...FAA has long had a history of such "benign tolerance." Administrators, many of whom have close ties to the airline industry, have taken great pleasure in touting the billions of dollars consumers save by flying upstart airlines like ValuJet. At the same time, the agency has been reluctant to force companies to use new technology, insisting on proof that the benefits outweigh the costs to the airlines. In the late '80s, for instance, the agency dragged its feet on requiring the installation of the ground-proximity warning system in commuter airlines, even though this simple device could have prevented...
...particular, the FAA has been especially slow to monitor an increasingly common practice: airlines' using outside contractors to perform routine maintenance and repairs. Although the ValuJet crash is now believed to have been caused by mislabeled oxygen generators rather than an inspection or a mechanical failure, those generators had been prepared for shipping by one such subcontractor, SabreTech Inc., a Phoenix, Arizona, company that handled a number of tasks for the airline...
ValuJet president Jordan vehemently defends this practice of outsourcing, saying it "has been done by the finest airlines. It is a sound concept; it is a good concept." This is true. But the drive to slash costs can sometimes lead to cut-rate care. The FAA has found that ValuJet contracted out all its maintenance to "geographically diverse low bidders" and that there were "multiple shortcomings" in the supervision of the firms. According to experts, the relationship between an airline and its maintenance teams must be symbiotic. "You need well-trained people, people whose morale is high," explains Louis Smith...
Outsourcing is here to stay, however, and last week the FAA conceded that it had been unprepared to handle the rise in "virtual airlines"--those assembled by contracting out various service components, from maintenance to reservations...