Sorting Out The Max Situation

A lot of speculation regarding what the Max mess will mean to the US air transportation system.

As a matter of reality, it appears that AA, UA, WN and AS won’t have the 737 Max fully back into their schedules until the end of 2020 – at best.

Currently, American and Southwest have assumed a June re-entry, but even that is still tentative. And even then, it won’t be immediate, either.

What needs to be kept in mind is that it’s not a simple matter bringing, say 40 – 45 stray airliners back into an airline system.

One major issue is pilot training… if the requirement is determined to be instruction in 737 Max-specific simulators, there’s going to be one whale of a backlog, as there are less than 30 such devices in existence today across the globe.

Waking A Fleet of 800 Airplanes. As of today, there are just short of 800 Max airliners on the ground, split near evenly between those grounded last March and those that have come off the production line since then and un-delivered.

Getting those flying machines un-pickled, lined up into modification centers, and back in airline schedules is going to take a lot of time, both for Boeing and for the carriers involved.

Therefore, don’t put much credibility in stories that a Max approval will result in a sudden capacity glut, causing fares to plummet. More veneer reporting. The process will be anything but sudden.

Not only will these airliners come back gradually, but every single one – bank on it – has a schedule line ready and waiting. In the US, Southwest hasn’t been able to add a single airplane since March, in the face of huge market opportunities.

Ditto for United and American – even though they have been continuing to add narrow-body A319s and E-175s to their system fleets over the last nine months. (American last week took delivery of another used A319 from China Southern, for example.)

In any event, continue to plan on a 3.0% – 3.5% growth in US airport enplanements in 2020 – and a June Max approval will not have much effect.

For more aviation insights and weekly updates be sure to visit the Boyd Group International Monday Flash at www.AviationPlanning.com.