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    Home»Money»Boeing’s Problems Have Airline CEOs Changing Plans for Growth
    Money

    Boeing’s Problems Have Airline CEOs Changing Plans for Growth

    Press RoomBy Press RoomMarch 13, 2024No Comments3 Mins Read
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    • Boeing’s 737 Max 10 and Max 7 jets are yet to be certified by regulators. 
    • United Airlines has taken the Max 10 out of its plans, even with 277 on order.
    • “We all need Boeing to be better,” said Southwest’s CEO.

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    Bull

    Boeing’s troubles are disrupting airlines’ plans to grow capacity as the planemaker suffers from delays.

    The 737 Max 10 and Max 7, the longest and shortest version of Boeing’s narrowbody jet, are yet to be certified by regulators.

    Increased scrutiny of Boeing’s processes following January’s Alaska Airlines blowout has made the pathway harder. Boeing withdrew a safety-exemption request for the Max 7 in the wake of the incident, pushing the certification timeline further back.

    Bloomberg reported that several airline chiefs had similar stories about delays as they spoke at a JPMorgan conference on Tuesday.

    Scott Kirby, United’s CEO, said he’d told Boeing to stop building Max 10s for the carrier because of uncertainty about when it will be certified, per Bloomberg.

    The airline’s chief financial officer, Mike Leskinen, said last month United is “deeply disappointed” in Boeing due to the delays. He said that instead of the Max 10, United would have more Max 9 and Airbus A321neo jets, per Reuters.

    United — which is Boeing’s biggest customer — has 277 Max 10 jets on order with options for another 200, Leskinen said in its fourth-quarter earnings call in January.

    The delays create problems for United’s plan to expand its capacity with 800 new jets by 2032.

    During the JPMorgan conference, Delta CEO Ed Bastian said deliveries for its Max 10 jets could come as late as 2027, Bloomberg reported.

    And Southwest said it doesn’t expect to receive any of its 737 Max 7 aircraft this year, per the outlet. It reportedly expected 79 jets overall this year, but will now receive 46.

    Last month, Southwest announced it will suspend all new pilot hiring after March 31 due to the production delays, Simple Flying reported.

    “We all need Boeing to be stronger two years from now, five years from now, 10 years from now,” Southwest CEO Bob Jordan said, per Bloomberg. “That takes precedent over delivery delays. We all need Boeing to be better.”

    Following the blowout, the Federal Aviation Administration has prevented Boeing from expanding production of the Max — capped at 38 jets a month until the regulator is satisfied Boeing is following all the rules for quality control.

    The American manufacturer delivered 27 jets last month, compared to Airbus’ 49.

    But the European planemaker’s backlog means there aren’t enough delivery slots for would-be customers to switch over from Boeing.

    Boeing did not immediately respond to a request for comment from Business Insider.

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