Page 8 - AAA OCTOBER - DECEMBER 2019 Online Magazine

necessary for oversight moving forward.” “We
will not work the 737 Max until and unless we
have full assurance from regulators around the
world, our colleagues in the flight deck, engi-
neers, and our airlines that the 737 Max is safe,”
Sara Nelson, president of the Association of
Flight Attendants, which represents United’s
flight attendants and those at 19 other airlines,
said in a statement.

Economic Impact
The crashes have so far cost Boeing more than
$8 billion, according to Bank of America Merrill
Lynch. Sales and deliveries of the Max planes
have dried up, and Airbus has made the most
of the situation by making major inroads into
markets hitherto dominated by the American
plane maker. After halting deliveries of the
planes shortly after the grounding, Boeing
later slashed production by 20% to 42 a month.
In July, the fourth straight month without any
new orders for the 737 Max, the company
said it could suspend production of the Max
altogether. In September, it received the first
converted order in months for the airplane, but
the twin crashes continue to take a toll on the
company’s deliveries that fell 47% to 302 air-
craft in the first nine months of 2019.
Not every airline is willing to give the air-
craft another chance. Within two weeks of the
second crash, Indonesian airline Garuda said
return to service for at least six months before they consider flying that it would cancel its US $4.9 billion order for
on it. US operators, including United Airlines which has 14 of the 50 Max 737s. The operator has received one
Boeing 737 Max 9s in its fleet, are prepared to wait before getting jet from its 2014 order and does not intend to
the plane back in the air. “We will be incredibly communicative to take delivery of the other 49. Another airline
all our customers and very transparent when that aircraft comes to decide against the 737s is Azerbaijan airline
back,” says United Airlines CEO Oscar Munoz Munoz. “The first AZAL, which has canceled, “due to safety rea-
and foremost objective is to not assume everyone will want to fly sons, a US $1 billion contract with the American
or assume everyone will get over it. We will wait until everyone plane maker to purchase 10 737 MAX jets.
agrees the Max is safe to bring back. We’re going to do this in a Icelandair has announced that it would be ter-
safe manner.” minating 45 of its 737 MAX pilots.
In October, United Airlines announced that it was taking the China’s biggest airlines, which according
737 Max from its schedule until January 6 next year. The airline to China Air Transport Association stood to
expects to cancel 93 flights a day in November and 75 a day in lose 4 billion yuan (US$579.41 million) if the
December. American Airlines has announced that it will keep the grounding of the aircraft lasted until the end
airplane grounded until January 16. Southwest Airlines, the biggest of June, have taken a much bigger hit as the
737 Max customer in the US with 34 aircraft, had announced, as aircraft continues to be out of service. Many
early as in July, that it would include the aircraft, in its schedule Chinese operators have sought compensation
only after Jan. 5. from Boeing for the disruption caused by the
grounding. Air China, China Southern Airlines
Making their stand clear and China Eastern Airlines together operate 53
Labor unions representing flight attendants at American and of the 96 Max planes in China. China Eastern
United have reservations about bringing the troubled aircraft Airlines, which has 14 737 Max aircraft, has also
back into service in haste. “After these two days of hearings, it is delayed deliveries of future planes. Norwegian
clear there were serious breakdowns in the supervision of the 737 Air is also hoping to reach an agreement with
Max,” Lori Bassani, president of the Association of Professional Boeing on compensation for the grounded
Flight Attendants, which represents American’s 28,000 cabin crew planes. Indonesia’s Lion Air Group is expected
members, wrote in a letter to Boeing’s CEO on Oct. 30. “We have to incur losses of over US $30 million due to
fundamental questions about whether the FAA has the resources the grounding.

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