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As hundreds lie dead following the latest tragedy to beset a Boeing passenger plane, it is too early to determine blame.

Pilot error, engine failure and bird strikes are among the theories all being banded about. Only the recovery of Flight AI171‘s black box flight recorders are likely to provide the concrete answers.

What is inescapable though is that this is an air disaster the plane’s maker, Boeing, could well do without.

Plane crash latest: 53 Britons on board

It sounds petty, in the midst of such a catastrophe, to be talking about the impact on a company, but this has been a civil aviation giant left deeply scarred, in the public eye, through its attitude to safety in recent years.

While the 787 Dreamliner’s record had been impressive up until today, the same can not be said for the company’s 737 MAX planes.

The entire fleet was grounded globally for almost two years following the demise of Ethiopian Airlines Flight 302 outside Addis Ababa in March 2019.

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Women mourn next to the coffins of relatives who died in the Ethiopian Airlines crash
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Women mourn next to the coffins of relatives who died in the Ethiopian Airlines crash in 2019. Pic: Reuters

All 157 people aboard were killed.

Six months earlier, a Lion Air 737 MAX, carrying 189 passengers and crew, crashed in Indonesia.

At fault was flight control software that has since been rectified.

That recent past continues to haunt Boeing.

It took those crashes to uncover a culture of cover-up. It amounted to not only a corporate failure but one of regulation and justice too, according to critics, as relatives were denied their days in court due to plea bargains.

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What happened to the Air India plane?

Just last month, the US Justice Department and Boeing agreed a non-prosecution agreement over those two fatal crashes in return for $1.1bn in fines and an admission that it obstructed the investigation.

It raises several questions over the US legal system and its ability to police corporate activity and incentivise playing by the rules.

Boeing safety record under scrutiny after first fatal Dreamliner crash

Mickey Carroll

Science and Technology reporter

The crash of an Air India plane, carrying 242 people bound for Gatwick Airport from Ahmedabad, is the first fatal incident for Boeing’s 787 Dreamliner.

Experienced pilots who have studied video of the moments before the crash have told Sky News the flaps on the wings appear not to be set in the normal take-off position, however the cause of incident is unknown.

In a statement, Boeing said: “We are in contact with Air India regarding Flight 171 and stand ready to support them.

“Our thoughts are with the passengers, crew, first responders and all affected.”

Multiple concerns about Boeing’s Dreamliners, the most modern passenger aircraft in service, have previously been raised by whistleblowers.

In April 2024, a Boeing quality engineer, Sam Salehpour, told members of a Senate subcommittee that Boeing was taking shortcuts to bolster production levels that could lead to jetliners breaking apart.

The engineer said he studied Boeing’s own data and concluded “that the company is taking manufacturing shortcuts on the 787 programme that could significantly reduce the airplane’s safety and the life cycle”.

“They are putting out defective airplanes,” he said.

Boeing denied Mr Salehpour’s claims about the Dreamliner’s structural integrity.

In the same week, a separate Senate commerce committee heard from members of an expert panel that found serious flaws in Boeing’s safety culture.

One of the panel members, MIT aeronautics lecturer Javier de Luis, said workers feel pressure to push planes through the factory as fast as they can.

When talking to Boeing workers, he said he heard “there was a very real fear of payback and retribution if you held your ground”.

Speaking to a Senate subcommittee in June 2024, Boeing chief executive Dave Calhoun said: “Our culture is far from perfect, but we are taking action and making progress. We understand the gravity.”

“We are taking comprehensive action today to strengthen safety and quality.”

In May 2024, federal investigators opened a fresh investigation into the Boeing 787 Dreamliner – after the firm said several employees had committed “misconduct” by falsely claiming tests had been completed.

The Federal Aviation Authority said Boeing was “reinspecting all 787 airplanes still within the production system and must also create a plan to address the in-service fleet” while the investigation is taking place.

Would a British manufacturer have been offered such a deal by US prosecutors?

As for regulation, we’re told oversight has been stepped up and the number of planes that Boeing makes is still subject to controls in a bid to boost quality.

The company has long denied putting profit before safety, but that is what almost every whistleblower to have come forward to date has alleged.

The production limits were implemented after a mid-air door plug blowout aboard an Alaska Airlines Boeing 737 MAX 9 flight in January last year.

They are hampering Boeing’s efforts to restore profitability.

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What we know so far about AI171 crash

A 5% fall in its share price at the market open on Wall Street goes to the heart of Boeing’s problem.

That is every time a Boeing plane is involved in an accident or failure, investors’ first instincts are to run for the hills.

Boeing says it is seeking more information on the nature of the Air India crash.

But whether Boeing’s plane is at fault for the loss of Flight 171 or not – and we have seen nothing so far to indicate that was the case – it’s clear the company has a long way to go to restore trust.

In a statement, Boeing president and chief executive Kelly Ortberg, said: “Our deepest condolences go out to the loved ones of the passengers and crew on board Air India Flight 171, as well as everyone affected in Ahmedabad.

“I have spoken with Air India chairman N. Chandrasekaran to offer our full support, and a Boeing team stands ready to support the investigation led by India’s Aircraft Accident Investigation Bureau (AAIB).”

Boeing will defer to India’s AAIB to provide information about Air India Flight 171, in adherence with the United Nations International Civil Aviation Organization protocol, the company added.

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Bread producers Hovis and Kingsmill close in on historic merger

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Bread producers Hovis and Kingsmill close in on historic merger

The owners of Hovis and Kingsmill are closing in on a definitive agreement to merge two of Britain’s most famous grocery brands following months of talks.

Sky News has learnt Associated British Foods (ABF), the London-listed company which owns Kingsmill’s immediate parent, Allied Bakeries, has proposed paying roughly £75m to acquire Hovis from its long-term private equity backers.

Banking sources said a deal could be formally agreed to combine the businesses as early as the end of next week, although they cautioned the complexity of the transaction meant the timing could yet slip.

Confirmation of a tie-up would come nearly three months after Sky News revealed ABF and Endless – Hovis’s owner since 2020 – were in discussions.

Industry sources have estimated that a combined group could benefit from up to £50m of annual cost savings from a merger.

ABF has also been exploring options for the future of Allied Bakeries separate from its talks with Hovis in the event a deal could not be agreed or is prevented from completing by competition regulators.

If it does go ahead, the merger will unite two historic bread producers under common ownership, with Allied Bakeries having been founded in 1935 by Willard Garfield Weston, part of the family which continues to control ABF.

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Hovis traces its history back even further, having been created in 1890 when Herbert Grime scooped a £25 prize for coming up with the name Hovis, which was derived from the Latin ‘Hominis Vis’ – meaning “strength of man”.

Persistent inflation, competition from speciality bread producers and shifting consumer habits towards lower-carb diets have combined to impair breadmakers’ financial health in recent decades, however.

In accounts filed at Companies House earlier this month, Hovis said it had “achieved positive financial progress despite continued tough trading conditions”.

The company reported sales of £439.6m in the 52 weeks to 28 September last year, down from £477.6m in the 53 weeks to 30 September 2023.

Earnings before interest, tax, depreciation and amortisation fell from £20.9m to £18.7m, which Hovis said was the result of the revenue decline and higher distribution costs.

“Overall bread share remained stable, despite significant price inflation and the ongoing cost-of-living crisis, demonstrating the resilience of the Hovis brand and its iconic status as one of Britain’s most loved food brands,” the accounts said.

This week, the trade publication The Grocer reported that Britain’s big four supermarkets, including Asda and Sainsbury’s, had delisted a number of Hovis-branded products.

The publication quoted a Hovis spokeswoman as saying the company was “aware of some adjustments to Hovis product lines in certain stores”.

“We remain fully committed to working collaboratively with our retail partners to grow our mutual businesses.”

The overall UK bakery market is estimated to be worth about £5bn in annual sales, with the equivalent of 11m loaves being sold each day.

Critical to the prospects of a merger of Allied Bakeries, which also owns the Sunblest and Allinson’s bread brands, and Hovis taking place will be the view of the Competition and Markets Authority (CMA) at a time when economic regulators are under intense pressure from the government to support growth.

Warburtons, the family-owned business which is the largest bakery group in Britain, is estimated to have a 34% share of the branded wrapped sliced bread sector, with Hovis on 24% and Allied on 17%, according to industry insiders.

A merger of Hovis and Kingsmill would give the combined group the largest share of that segment of the market, although one source said Warburtons’ overall turnover would remain higher because of the breadth of its product range.

Responding to Sky News’ report in May of the talks, ABF said: “Allied Bakeries continues to face a very challenging market.

“We are evaluating strategic options for Allied Bakeries against this backdrop and we remain committed to increasing long-term shareholder value.”

In a separate presentation to analysts, ABF – which is also in the process of closing its Vivergo bioethanol plant in Hull after pleading for government support – described the losses at Allied, which also owns own-label bread manufacturer Speedibake, as unsustainable.

The company does not disclose details of Allied Bakeries’ financial performance.

Prior to its ownership by Endless, Hovis was owned by Mr Kipling-maker Premier Foods and the Gores family.

At the time of the most recent takeover, High Wycombe-based Hovis employed about 2,700 people and operated eight bakery sites, as well as its own flour mill.

Hovis’s current chief executive, Jon Jenkins, is a former boss of Allied Milling and Baking.

This weekend, ABF declined to comment, while Endless could not be reached for comment.

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Good economic news as sunny weather boosted retail sales

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Good economic news as sunny weather boosted retail sales

Retail sales grew in June as warm weather boosted spending and day trips, official figures show.

Spending on goods such as food, clothes and household items rose 0.9%, the Office for National Statistics (ONS) said.

It’s a bounce back from the 2.8% dip in May, but last month’s figure was below economists’ forecast 1.2% uplift as consumers dealt with higher prices from increased inflation.

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Also weighing on spending was reduced consumer confidence amid talk of higher taxes, according to a closely watched indicator from market research firm GfK.

Retail sales figures are significant as they measure household consumption, the largest expenditure in the UK economy.

Growing retail sales can mean economic growth, which the government has repeatedly said is its top priority.

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What does ‘inflation is rising’ mean?

Where have people been shopping?

June’s retail sales rise came as people bought more in supermarkets, and retailers said drinks sales were up.

While hot and sunny weather boosted some brick-and-mortar shops, the heat led some to head online.

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Non-store retailers, which include mainly online shops, but also market stalls, had sold the most in more than three years.

Not since February 2022 had sales been so high as the Met Office said England had its warmest ever June, and the second warmest for the UK as a whole.

The June increases suggest that the May drop was a bump in the road. When looked at as a whole, the first six months of the year saw retail sales up 1.7%.

Filling up the car for day trips to take advantage of the sun played an important role in the retail sales growth.

When fuel is excluded, the rise was smaller, just 0.6%.

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Despite lower consumer sentiment and more expensive goods, consumers are benefitting from rising wages and are cutting back on savings.

The ONS lifestyle survey – backed up by hard data like the Bank of England’s money and credit figures – shows that households have rebuilt their rainy day savings and are cutting back on the amount of money they squirrel away each month.

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Former Poundland owner lines up advisers as restructuring looms

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Former Poundland owner lines up advisers as restructuring looms

The former owner of Poundland is lining up advisers to supervise its transition to new shareholders through a court-sanctioned process that will involve store closures and job cuts at the discount retailer.

Sky News has learnt that Pepco Group, which is listed on the Warsaw Stock Exchange, is drafting in FRP Advisory weeks after it struck a deal to sell Poundland to Gordon Brothers.

Industry sources said FRP had been asked by Pepco to act as an observer, with the High Court scheduled to sanction a restructuring plan in the last week of August.

Under the proposed deal, 68 Poundland shops would close in the short term, along with two distribution centres.

More shops are expected to be shut under Gordon Brothers over time, resulting in hundreds of job losses.

Pepco is said to be particularly focused on IT systems which Poundland uses in common with Pepco’s operations in Poland.

Barry Williams, managing director of Poundland, said at the time of the deal’s announcement: “It’s no secret that we have much work to do to get Poundland back on track.

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“While Poundland remains a strong brand, serving 20 million-plus shoppers each year, our performance for a significant period has fallen short of our high standards and action is needed to enable the business to return to growth.

“It’s sincerely regrettable that this plan includes the closure of stores and distribution centres, but it’s necessary if we’re to achieve our goal of securing the future of thousands of jobs and hundreds of stores.

Prior to the deal’s announcement, Poundland employed roughly 16,000 people across an estate of over 800 shops in the UK and Ireland.

Tax hikes announced by Rachel Reeves, the chancellor, in last autumn’s Budget have increased the financial pressure on high street retailers.

In recent months, chains including WH Smith, Lakeland and The Original Factory Shop have changed hands amid challenging circumstances.

In June, Sky News revealed that River Island, the family-owned clothing retailer, was also working with advisers on a rescue plan aimed at averting its collapse.

Pepco and Poundland declined to comment.

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