You are here: Home » International » News » Companies
Business Standard

Large Boeing 737 MAX customers signal caution on orders amid Covid-19

When the 737 MAX was grounded globally in March 2019 following two fatal crashes, airlines canceled flights because they lacked enough airplanes to meet strong travel demand

Topics
Boeing 737 MAX | Coronavirus

Reuters  |  DUBLIN/CHICAGO 

A Boeing 737 Max airplane owned by Icelandair is seen on a parking lot at Boeing Field in Seattle. Photo: Reuters
A Boeing 737 Max airplane owned by Icelandair is seen on a parking lot at Boeing Field in Seattle. Photo: Reuters

By Conor Humphries and Tracy Rucinski

DUBLIN/CHICAGO (Reuters) - A day after Boeing Co received approval for its 737 MAX to fly again following a 20-month grounding, its two largest U.S. and European customers signaled caution on their order books as they monitor demand in the midst of the pandemic.

U.S. based Southwest Airlines , Boeing's largest customer worldwide, said this week it would just take new MAX jets to replace jets it's retiring rather than grow its fleet, and on Thursday raised the prospect of scaling back its fleet due to the pandemic.

"If demand is going to be persistently depressed, we can retire and not need to take airplanes as replacements," Southwest Chief Executive Gary Kelly told journalists.

When the 737 MAX was grounded globally in March 2019 following two fatal crashes, airlines canceled flights because they lacked enough airplanes to meet strong travel demand.

Now many have parked jets or even gone out of business in the pandemic, creating challenges for Boeing as it tries to find homes for 737 MAX jets that are built but now lack buyers.

A senior executive of Boeing's largest European customer, low-cost carrier Ryanair , said on Thursday that it is not currently looking at additional orders for the jet, but may buy more if prices fall in the wake of COVID-19.

Executives at the airline have said repeatedly over the past year that the airline was discussing possible additional orders amid ongoing talks with Boeing on compensation for delays to its current order for 210 MAX jets.

"Over time one can see that there will be a way that aircraft are going to be cheaper ... and we will capitalize on that at some stage," Ryanair DAC Chief Executive Eddie Wilson said at the Skift Aviation Forum.

"But at the moment it's just the ... existing order that we have," he said.

Ryanair has said it expects to take delivery of its first 30 MAX jets by next summer. The United States lifted a 20-month-old flight ban on the MAX on Wednesday and European regulators are expected to follow suit.

Norwegian Air Shuttle , another major MAX customer, this week sought bankruptcy protection in Ireland.

 

(Reporting by Conor Humphries and Tracy Rucinski; Editing by Edmund Blair and Nick Zieminski)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Fri, November 20 2020. 09:08 IST
RECOMMENDED FOR YOU
.