February 27, 2024


It’s not just United Airlines and Alaska Airlines that were impacted by the grounding of Boeing’s 737 Max 9s. Delta, Southwest, and American have taken a gut punch, too.

Sure, Alaska had to deal with frightened passengers who were aboard the fateful flight in early January, in which a faultydoor plug flew off a 737 Max 9 mid-flight. United and Alaska were the two airlines forced to take their Max 9’s out of commission and cancel hundreds of flights. But the ensuing US Federal Aviation Administration (FAA) inspection of Boeing’s manufacturing process is creating holdups—and hence, supply chain issues—that will ripple across the entire industry.

Executives from all major airlines are saying they’re holding Boeing’s feet to the fire to ensure safety, but they’re feeling the pressure themselves to deal with the manufacturer’s production delays.

Southwest Airlines

The company is the largest operator of Boeing’s 737 models, though it does not have any Max 9 models. In fact, Southwest only uses Boeing 737s.

But Southwest had to adjust its capacity expectations for 2024 due to Boeing’s issues. That matters because airlines stay competitive by adding modern planes to their fleet and using additional capacity to take older models out of service or update them.

The company said Thursday (Jan. 25) it will receive 6 fewer aircraft than previously expected in the coming year. It currently has a fleet of 818 aircraft, with 794 in service, and expects 79 deliveries in 2024. Southwest worked out a deal to purchase more than 300 Max 7 planes over the next decade, but those are facing certification by the FAA. Southwest previously thought it would get certified in April, but company executives told investors the process will now probably take until the end of the year.

💬 What they said about Boeing: “[W]e have confidence that Boeing will get all this figured out with the FAA, [and] will come out a better company.” —CEO Bob Jordan to investors Jan. 25

American Airlines

American is likely the least impacted of major operators by the troubles at Boeing.

“Boeing’s current issues are all around the MAX 9 and 737-900s. American Airlines does not fly those aircraft,” said American Airlines CEO Robert Isom on a call with investors Thursday. “We’re a huge Boeing customer, though, and we’re dependent on them for just producing.”

Isom noted that while American’s fortunes are in part tied to Boeing’s, the company’s scheduled deliveries of 20 Max 8s in 2024 shouldn’t be delayed by the FAA investigation into the manufacturer. Notably, American is the largest customer of Airbus.

💬 What they said about Boeing: “We need Boeing to be successful over the long run. They’ve got to get their act together.” —Ison to investors Jan. 25

Delta

Delta Air Lines, like American and Southwest, doesn’t fly any 737 Max 9s, so the airline wasn’t impacted by the groundings.

Delta has ordered 100 Max 10s for delivery beginning in 2025, though. Delta CEO Ed Bastian expressed confidence last week in an interview with CNBC that those aircraft will make it to the company on time, whereas United has appeared more skeptical.

💬 What they said about Boeing: “Boeing is such a vital part of our industry, our history, and we need them to succeed.” —Bastian, in the interview with CNBC



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