Southwest has a close relationship with Boeing. It has flown 737 variants almost exclusively for its entire history. On a 2011 conference call, the company’s CEO was asked about what he thought about the recently announced 737 MAX.
It wasn’t long before airlines started expressing their excitement for the model.
Praise wasn’t limited to airlines in the US. Panama’s Copa Airlines, for example, also only saw upsides to the plane.
Canadian carrier WestJet was excited about what the new plane would do for its service.
The airline industry is obsessed about efficiency and unit economics. The 737 MAX was cheaper to operate by seemingly every measure—including “CASM,” the average cost of flying one seat one mile.
On March 10, 2019 Ethiopian Airlines Flight 302 crashed. Coming around five months after Lion Air Flight 610 crashed in similar circumstances, authorities around the world grounded the 737 MAX. Airline executives immediately expressed concerns for their bottom lines. Airplanes on the ground don’t make money.
Analysts began asking airlines what kind of compensation they would seek from Boeing for the disruption to their businesses.
It became harder to sell high-priced, last-minute tickets because with a shortage of planes there were fewer seats available for sale.
Yet airline execs are still confident in the 737 MAX, even though they realize they’ll need to convince their passengers that the planes are safe.
An added complication is waning trust in the US Federal Aviation Administration. The aviation regulator was one of the last to ground the plane following the Ethiopian crash, and later faced criticism for the way in which it certified the 737 MAX.
In a worrying sign for Boeing, Air France-KLM made sure to note that it had no plans to order any 737 MAX planes.
Air Canada, which has 20 of the planes, said it could manage the 737 MAX grounding just fine.
Though, apparently, no amount of teamwork and creative scheduling could keep the airline completely out of trouble.
Copa, which once said the 737 MAX could do no wrong, now blames it for its financial woes.
Its CEO still has hope, though.
There’s also the issue of what to do about airlines’ open orders for 737 MAX planes.
There are also knock-on effects. When new planes don’t replace old planes, the airlines expecting hand-me-downs have to adjust.
Even still, airline bosses are convinced of the need for the 737 MAX in their fleets—whenever it’s allowed to fly again.