A few months ago, things seemed hopeless for the 737 MAX. The MAX has been grounded worldwide for over fifteen months after two crashes that killed over 300 people. Since then, Boeing has been making adjustments to the plane, trying to get it recertified and deemed airworthy once again. Boeing has, of course, experienced difficulty during this time, with lawsuits, investigations, canceled orders, loss of customers, loss of trust, and to make matters worse, COVID-19. But now, as the MAX enters the final stages of the recertification process, it seems as if things may start going Boeing's way.
Recently, the MAX has started the final tests for recertification, and if all goes well, the plane could be flying again before the end of the year. The MAX does seem to be on track for this to happen, especially after the chief of the FAA flew the aircraft himself and made positive remarks after. While this would be a huge victory for Boeing, the aircraft manufacturer would still face problems surrounding the MAX.
One of the biggest issues facing Boeing is sales. While Boeing, for the most part, has upheld its reputation, the MAX has proven to be a loss of revenue for the aviation mammoth. Airlines have canceled orders for many reasons. Airlines lost their trust in Boeing after being lied to and put at risk, they had to order different aircraft to replace the grounded MAX, customers would not trust the aircraft, and now, with a much lower demand for air travel, over 300 737 MAX orders have been canceled.
However, it seems Boeing is coming close to getting sales. Boeing is in talks about selling the MAX to both Alaska Airlines and Ryanair, among others. In August, Boeing announced they received their first MAX orders since 2019 from a Polish charter airliner, Enter Air, who requested 2 of the aircraft.
Boeing is supposedly in talks with Alaska Airlines, although both parties declined to comment when asked about the possibility of new aircraft orders from the Seattle based airline. Before the groundings, Alaska, who proudly boasts their all Boeing fleet, had ordered 37 MAX planes. Although it is not certain how many the airline will order, Alaska will receive less than that the second time around, as there is less demand as well as a tighter budget. Additionally, the deal is also expected to include significant discounts.
Additionally, Ryanair, another all Boeing airline, is expected to buy up to 200 of the MAX aircraft. The Irish low-cost carrier had 135 MAX models made and undelivered. Ryanair is in a major financial crisis, but right now their priority is negotiating this major deal with Boeing. Eddie Wilson, a senior manger at Ryanair, said "We've a current order with Boeing for 210 MAX aircraft, 135 of those firm orders and 75 options. We're working with Boeing at the moment and our priority is to get that order back into service and we expect that to be in early 2021." 150 MAX jets would cost $18,700,000,000 at list price, but buyers are most likely to be given significant discounts.
"Air Canada has sealed sale-and-leaseback transactions for three Boeing 737 Max 8 aircraft with Jackson Square Aviation and six Max 8 aircraft with Avolon for total proceeds of $365 million." These transactions are part of the Canadian carrier's efforts to "bolster its liquidity" which it says stands at "almost $6 billion." The airline has said "Air Canada will continue to explore financing arrangements as additional liquidity may be required or to refinance existing debt to push out maturities." At the end of September, the airline completed two transactions worth $1.52 billion, replacing plans to buy the a220.
Do you think more airlines will buy begin to order the MAX soon? Would you fly on one when they are safe to fly again? Let us know, and stick with TheExplorerBlog for updates on the MAX!
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