In its financial stament for the third quarter of 2020, Icelandair said it is expecting to take delivery of three more 737 MAX aircraft in the second quarter of next year. Following a compensation agreement with Boeing, the airline has reduced its order of the beleaguered jet from sixteen to a total of twelve.
The unfolding saga of the MAX
The MAX saga continues. While already built planes have been sitting on the tarmac for months and months as a result of the plane’s suspension, airlines worldwide have been deferring deliveries as a result of the unprecedented crisis. Before the spring of 2020, carriers suffered economically from the grounding of the model, and Boeing has been forced to part with large sums in compensation.
Meanwhile, the MAX’s recertification is inching ever closer. Some carriers, like American Airlines, is planning to reenter the aircraft into scheduled service by the end of the year. Others, who have more of the jets on order, are now counting on deliveries in early 2021. One of them is Icelandair.
In its financial statement for the third quarter of 2020, Icelandair Group said it expects to take delivery of three more Boeing 737 MAX jets in the first half of 2021.
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From sixteen to twelve
The Icelandic flag-carrier already has six of the planes in its fleet, five MAX 8s, and one MAX 9. Four were delivered in March 2018, and two in February 2019, just in time for the grounding one month later.
The purchase agreement signed between Boeing and Icelandair in 2013 was for sixteen 737 MAX aircraft. However, as part of a compensation agreement the airline reached with the manufacturer in August this year, the number of undelivered aircraft has been cut to a total of six, rather than ten.
The airline is now expecting three of those in Q2 2021 and the remaining three in the period of Q4 2021 to Q1 2022. Icelandair is currently planning for the MAXs already in its fleet to return to service in the first quarter of 2021. Granted, of course, that the aircraft regains certification as expected.
Undisclosed compensation from Boeing
Other than expected aircraft deliveries, Icelandair’s financial statement makes for pretty gloomy reading. The carrier says it operated only 9% of its passenger flight schedule in the third quarter, and the number of passengers was down by 90% from the previous year.
The airline’s total revenue was down by 81%. However, the post of “other” under operating revenue took a significant jump from $6.8 million in 2019 to $36.4 million in 2020. The main reason for this, Icelandair said, was the compensation settlement it had reached with Boeing for the “loss incurred by the MAX suspension.” Meanwhile, the exact figure of the compensation remains undisclosed.
Will you fly on the MAX right away when it returns to regular passenger service? Let us know your thoughts in the comments.