Southwest Airlines estimates it will take one to two months to get its grounded Boeing 737 MAX fleet back into service after the type receives regulatory approval to fly again.
Southwest is the biggest operator of the MAX with 34 planes and said last week that the grounding had cost it $US175 million in reduced operating income in the second quarter alone.
It also revealed it was extending MAX-related flight schedule adjustments through to January 5.
READ: Boeing still hopes for October return to service for the MAX
“Based on the most recent guidance from Boeing, we currently are assuming regulatory approval of MAX return to service during fourth quarter 2019,’’ chief executive Gary C. Kelly said in US carrier’s recent second-quarter results announcement.
“With this in mind, we will proactively extend the MAX-related flight schedule adjustments through January 5, 2020, to provide reliability of our operation and dependability for our customers booking their fall and holiday travel.
“Following a rescission of the Federal Aviation Administration order to ground the MAX, we estimate it will take us one to two months to comply with prospective FAA directives, including all necessary pilot training.
“The FAA will determine the timing of MAX return to service, and we offer no assurances.”
Southwest reported a second-quarter net income of $US741 million and Kelly lauded the airline’s financial and operational performance as “remarkably strong’ given the impact of the MAX groundings.
He said the airline generated record revenues, strong margins and cash flows as a healthy profit-sharing accrual for employees and significant returns for shareholders.
“Our Employees did a heroic job managing approximately 20,000 flight cancellations under operationally difficult circumstances while delivering excellent customer service,’’ he said.
Noting Boeing’s decision to take a $US4.9 billion after-tax charge due to the MAX crisis, he said Southwest had been involved in preliminary discussion with the manufacturer about compensation for the MAX groundings.
“We have not reached any conclusions regarding these matters, and no amounts from Boeing have been included in our second-quarter results,’’ he said.
Southwest estimates the MAX grounding will mean growth in available seat miles will be in 1 to 2 percent range in 2019, rather than the original plan to grow capacity by almost 5 percent.
“As such, we are taking necessary steps to mitigate damages and optimize our aircraft and resources,’’ Kelly said.
“We will cease operations at Newark Liberty International Airport and consolidate our New York City presence at New York LaGuardia Airport, effective November 3, 2019.
“The financial results at Newark have been below expectations, despite the efforts of our excellent team at Newark.”
Another MAX operator, American Airlines, reported last week that the MAX groundings had resulted in a hit to pre-tax income of $US175m and said it expected the full-year impact to be $US400m.
American has removed all MAX flying from its flight schedule through to November 2.
