Tag Archives for boeing 737 MAX.
At the end of last week American Airlines told its pilots that based on conversations with the FAA and Administrator Stephen Dickson that they “see the finish line, it’s making good progress” bringing the Boeing 737 MAX into service. Their “targeted timeframe… [is] end of October-ish for the ungrounding to occur” for the aircraft. American intends to fly passengers in commercial service with the MAX starting in the second half of December.
Canada and Europe are doing their own test flights to re-certify the Boeing 737 MAX, which Boeing now refuses to call the MAX, instead of just relying on the FAA.
But the U.S. wouldn’t let Canadian and European inspectors into the U.S. to test the plane with Boeing – because coronavirus (the regulators might bring the virus into the U.S.). So regulators get picked up in Vancouver by Boeing, flown to Beoing field and back.
Boeing announced the sale today of two 737 MAX aircraft. That’s a big deal because the MAX, in service only since fall 2018, has been grounded since March 2019 – and because airlines generally are conserving cash rather than spending money to buy planes.
The announcement, though, is most notable for the verbal jujitsu Boeing uses as they give the plane a new name: 737-8, which is either not meant to be confused – or meant to be confused – with the older 737-800.
I’ve been expecting the Boeing 737 MAX to return to the skies before the end of the year, and it’s looking a bit touch and go whether it’ll re-enter commercial service by then. However American Airlines President Robert Isom told employees of the airline on Thursday that they currently expect the plane to be approved to fly by the FAA in October and back in the air flying for commercial airlines in December.
The question I have is what covenants were agreed to – aside from usual cancellation penalties or costs to defer deliveries – when American entered into a settlement at the beginning of the year with Boeing over the MAX?
At the time the value of the settlement was estimated at around $600 million although the form and timing of payments weren’t clear. If the settlement included conditions including acceptance of future deliveries, that could explain the airline’s willingness to do so, and could mean rejecting deliveries now would be even more costly than usual.
Boeing projected recently that re-certifying the 737 MAX will take until summer. Once it gets government approvals airlines still have to bring planes out of storage and prepare them for service, and they have to train pilots on new procedures – which will take time in part because of a limited number of available simulators.
And yet American Airlines and other carriers have the plane scheduled back into service in June. CEO Doug Parker updated employees on progress bringing the 737 MAX back into service during last week’s Crew News monthly question and answer session.
A series of embarrassing emails have come out, following embarrassing text messages which were revealed in the fall. Some perspective is needed here, though.
Companies are frequently undone by emails. DNC emails certainly didn’t help Hillary Clinton during the 2016 Presidential election. Emails hurt Microsoft when the government prosecuted an anti-trust case against it for monopolizing the web browser market (gosh if everyone knew then what we know now). It amazes me that companies store past non-work related emails.
American Airlines has previously said they’ve lost about $580 million from the grounding of the MAX. I actually don’t believe they’ve lost anything close to that since they’ve largely cut what they believe are the biggest money losing flights.
However the fact that American is saying they’ll contribute an additional $30 million to employee profit sharing gives us some indication of the value of the settlement.
This just seems wrong: a children’s book Max, the Airplane that Couldn’t Fly. It’s about how we’re all different, and about overcoming challenges at Boeing.
Boeing CEO Dennis Mullenburg, who had been stripped of the company’s Chairmanship in October, was fired and will be replaced as follows.
Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel -- a topic he has covered since 2002.
Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »
