Boeing 737 Max and its Return to Service

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Boeing 737 Max and its Return to Service

The nightmare of Boeing 737 Max, grounded since March 2019, is in the final phases for a solution and the certification is expected to be approved in the coming weeks. It is a good piece of news for Boeing and the several Airlines with aircrafts grounded or waiting for new deliveries. It will still take some time to see the 737 Max in the skies again as the aircrafts will require some work and pilots will require training. After more than a year, Boeing and the various Airlines are now able to make plans to return the 737 Max to service, though it will be a challenge given the current global pandemic situation.

A quick review of the problem and the solution

            The requirement to ground the Boeing 737 Max happened right after the second fatal accident on March 10, 2019 with Ethiopian Airlines Flight 302, just 5 months after the first one on October 29, 2018 with Lion Air Flight 610. The two accidents killed 346 people and put in question the design of the aircraft, the pilot’s training and the certification process between Boeing and the FAA.

The worldwide Boeing 737 Max fleet was grounded in March 2019 and since then, Boeing and the FAA are working on a new re-certification for the aircraft. The main problem with the aircraft is attributed to the MCAS, or Maneuvering Characteristics Augmentation System, that put the pilots on both accidents unable to respond to the problem. In the re-certification phase, the MCAS was intensively reevaluated by the FAA and Boeing resulting in software adjustments, changes in the operations manuals and training. After all evaluation and changes, followed by flight tests, the FAA is finally convinced that the Boeing 737 Max is safe to return to service. This confidence was sustained recently by the European Agency, EASA, after the flight tests performed well resulting in the Boeing 737 Max achieving the necessary safety requirements. The certification is still in process but there is a high expectation the Boeing 737 Max can return to service before the end of 2020.

The Future of Boeing

            After losing billions of dollars due to the recertification process, production shutdown, compensation to suppliers and customers, hundreds of produced and undelivered aircraft and order cancellations, Boeing can now breathe again with the aircraft’s imminent release. This means that Boeing will soon resume production of its Boeing 737 Max, certainly with very low demand due to the cancellations and the global aviation crisis caused by the pandemic situation of Covid 19.

            Even with the upcoming release, the situation is not as exciting as it should be, since the current scenario with Covid 19 has reduced the demand for flights and the aviation industry is struggling to manage costs. The chart below provides an overview of the orders cancellations for the Boeing 737 Max from January to July 2020 attributed to the pandemic crisis.

(Source: https://airlinegeeks.com/2020/07/12/boeing-loses-462-orders-for-737-max-amid-covid-19-fallout/)

The Covid 19 is one additional big factor in the whole history, and despite everything, Boeing still needs to recover the airlines and passengers trust in the Boeing 737 Max. In line with the issue of trust, some Airlines are committed to informing their passengers when the aircraft they are due to fly on is a Boeing 737 Max and that passengers may have the option of choosing to not travel on this aircraft with a refund guaranteed. As everything that has been happening with the Boeing 737 the path will be very difficult, even with some airlines that simply stopped counting on having an aircraft of this model and that they think that Boeing should simply make a new plane as the name Max is already condemned.            

The following timeline shows the estimate scenario when the Boeing 737 Max will be potentially coming back to service:

(source: https://seekingalpha.com/article/4379452-boeing-737-max-close-to-victory)

Boeing is just one step away from winning the first battle with the recertification of the 737 Max, but it still has many more battles ahead. That said, due to the company’s history and strength, even with the adversities it had with the 737 Max, Boeing may be able to regain its prestige in the coming years. The solution for the Boeing 737 Max is almost completed, but specialists still believe that a more robust solution and feasible one should be available in the future but the authorities believe that the current solution puts the aircraft in safer and reliable condition.

Finally, the graph below shows the impact that Boeing had with the grounding of the 737 Max and Covid 19 and the expectation that deliveries, although below expectations, will be very important for Boeing’s resurgence:

It seems a reasonable recovery but at the end, Boeing will stop delivering at least 1700 Boeing 737 Max in this period.

The return of the Boeing 737 Max

Airlines that already have the Boeing 737 Max grounded or have open orders with Boeing are certainly relieved with the latest news. For these Airlines the operation of the Boeing 737 Max means costs reductions in terms of the fuel consumption, less maintenance costs associated with new aircrafts and consequently a higher profit, which is very much desired in the current scenario. Just as Boeing has suffered, the Airlines too has suffered, such as accumulating additional costs to keep the aircraft on the ground and properly preserved and with no revenues, not to mention the numerous costs related to pilots and training that have already been spent. All these may soon pass, and the Airlines can think about planning the return of the Boeing 737 Max to service.

The Covid 19 crisis and mainly passengers concerned with flying in a 737 Max are also challenges that airlines will need to overcome over time. Due to this concern, some airlines have already stated that a passenger who are not yet willing to fly in a Boeing 737 Max will be able to reschedule their flights with no further fee, at least until confidence in the equipment is restored again.

American Airlines for example plan to return to service with the Boeing 737 Max by the end of 2020, perhaps the first airline to start doing so, with few flights at first, and warning passengers that they will be flying on a Boeing 737 Max aircraft.

Air Canada, has introduced the Boeing 737 Max in the fleet without having had any 737 versions prior to that. Therefore, Air Canada had to hire pilots specifically for these aircraft, who are currently waiting for the release of the aircraft.

Ryanair, from Ireland, already has a huge order with Boeing and expects to start receiving new aircraft by early 2021.

There is therefore a good expectation for the Airlines that opted for the Boeing 737 Max in the past on its return to service where the lower operating costs may somehow contribute to a better adaptation of this model in a time of world crisis due to the Covid 19. The forecast will not be as bright as prior to Covid-19, but it will still positively contribute to operating with a more efficient aircraft and after a new recertification, a safer aircraft.

For now, all that remains is for Boeing to continue the hard work and for airlines to await the long-awaited certification of the Boeing 737 Max before putting their plans into action.

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