As it prepares for a new reality following the COVID-19 pandemic, United Airlines has decided to delay the number of Boeing 737 MAX aircraft that it had planned to add to its fleet. Instead of its original order, United Airlines is now going to take less than half the number of MAXs it wanted over the next couple of years.
During a first-quarter earnings call on Friday, United Airlines chief financial officer Gerry Laderman said that the full-service carrier is planning to emerge from the coronavirus crisis as a much different airline.
United now wants just 40 Boeing 737 MAXs
Instead of its pre-coronavirus order, the Chicago-headquartered airline will now receive 40 737 MAX aircraft from the Seattle planemaker by the end of 2021. This new reality means that United has delayed more than half its order with Boeing for the currently still grounded plane.
As far as the first deliveries of the 737 MAX are concerned, United says it is dependent on regulators re-certifying the plane. The Boeing 737 MAX was subject to a worldwide grounding in March of 2019 following two deadly crashes that killed 346 people. If the Boeing 737 MAX receives re-certification soon, United says it could take 16 aircraft this year and 24 planes in 2021.
As well as the new MAX aircraft, United says it is committed to receiving eight Boeing 787-9s this year and eight 787-10s the following year. Both models of the aircraft United had on order were already under construction before the coronavirus struck.
Boeing has had to cut production of the 787 and 777
Regarding United Airlines decision to delay its request, aviation website The Points Guy quotes Boeing’s president and CEO David Calhoun as saying:
“We’ve been having intense discussions for the better part of a month with our MAX customers over deliveries.”
It is not just the MAX where Boeing is taking a hit with a demand for widebody 777 and 787 also under pressure. Airlines cannot hold onto their older planes forever and know there is a lag time between ordering and delivery. Long-term goals must also come into consideration, even though they may be temporarily put on hold until the industry recovers.
As things stand right now, airlines are starting to realize that there is no quick fix to get people flying again. With all the social distancing, face masks, and blood tests being floated as ideas, knowing where to start is a problem in itself. Ideally, airline bosses are waiting on government advice on what they must do and the lifting of quarantines for international travel before they can come up with a workable plan.
United will emerge from COVID-19 a much different airline
United for its part seems to be taking a worst-case scenario approach with company president Scott Kirkby saying on Friday:
“Disney World needs to be open… Cafes and museums in Paris need to be open before people go back.”
While all this is going on, United has cut its capacity by 90% and is considering what it will do with furloughed employees once the CARES Act assistance expires on September 30.
“When we emerge from this, United Airlines — and the airline industry — is going to look different,” said Kirby.
Any way you look at the airline situation, you cannot see a ray of sunshine. They are all hoping that things pick up sooner rather than later, yet with governments rightly being afraid to lift restrictions too soon, the public is right to stay closer to home.