Stay informed with free updatesSimply sign up to the Airlines myFT Digest — delivered directly to your inbox.US airline leaders expressed frustration over Boeing’s quality issues on Tuesday. They disclosed the cost impact and delivery delays from the fuselage blowout on an Alaska Airlines flight this month. “We’re going to hold them accountable. Boeing needs to get their act together,” said American chief executive Robert Isom.
Boeing’s issues over the past number of years were “unacceptable”, he added. No matter who was leading the plane maker, he said, “all of Boeing needs to come together and to get back on the right track”. United Airlines and Alaska Airlines’ bosses also had strong words.
“We’re going to hold Boeing’s feet to the fire to make sure that we get good aeroplanes out of that factory,” said Alaska CEO Ben Minicucci. Shares in Boeing dropped almost 6 per cent in midday trading on Thursday. The Federal Aviation Administration barred it from increasing output of its Max series, citing quality-control concerns. Alaska on Thursday said it expected to take a $150mn hit to profits this year from the grounding of its Boeing 737 Max 9 fleet.
Rivals Southwest and American, meanwhile, expect fewer Boeing aircraft to be delivered than planned this year as a result of the accident and the FAA ban on the aircraft maker expanding production. The 737 Max family of single-aisle jets are Boeing’s most popular planes and are flown by airlines around the globe.
Southwest was now planning for about 79 Max aircraft to be delivered in 2024, down from the 85 agreed with Boeing. Southwest CEO Robert Jordan voiced some support for Boeing, saying: “I have absolute confidence they will work their way through this and address the issues.”
American chief financial officer Devon May on Thursday told analysts the carrier expected 20 Max 8 deliveries this year. In October, the airline had pencilled in 25 Max family deliveries for 2024.
Pressure is mounting on Boeing after the blowout, which is viewed as the latest in a line of quality issues since two fatal crashes of the smaller Max 8 in 2018 and 2019 that killed a combined 346 people. With the knock to profits, Alaska said it anticipated 2024 adjusted earnings per share of $3-$5.
Low-cost carrier Ryanair, one of Boeing’s largest customers, on Thursday welcomed the FAA’s decision to block the expansion of the Max production line, which it said would “allow Boeing the time and space to improve quality control of the aircraft it manufactures”. The Irish airline added it had been reassured there would be no additional delays to deliveries of its Max 8 aircraft.
Shares in American and Alaska were up 9 per cent and 3.5 per cent respectively in midday New York trading, with Southwest down 2 per cent.
