Boeing Sees Order Rebound with American Airlines Despite Pending FAA Approval for 737-10 Jet

In a significant rebound, Boeing reported an increase in commercial jet orders for March, largely propelled by a substantial order from American Airlines for the 737-10 model, which has yet to receive FAA approval for passenger service.

American Airlines has demonstrated considerable confidence in Boeing by placing an order for 85 units of the 737-10, the largest variant of the 737 series, which is still pending certification. This order also included a conversion of 30 previous orders from the smaller, operational Max 8 to the larger Max 10 model, with an additional option for 75 more units in the future.

This announcement was part of Boeing’s March and first-quarter sales and delivery report released on Tuesday, which revealed no new orders for any other versions of the 737 Max, aside from the 28 orders received for its widebody 777 jets during the same period.

The certification of the 737-10 has faced delays, particularly after an incident involving a 737 Max 9 from Alaska Airlines on January 5, where a door plug malfunction resulted in significant damage. This incident has raised additional scrutiny over the Max series’ anti-icing equipment, leading Boeing to withdraw its request for a waiver necessary for the FAA certification of the Max 10 and the smaller Max 7 model.

The delay in certification caused by this and other safety concerns led United Airlines CEO Scott Kirby to state that the airline could no longer depend on the delivery schedule of the 737-10, describing the situation as the “straw that broke the camel’s back.” While United has not canceled its orders for the 737-10, it is exploring alternatives, potentially from Airbus, though this could result in longer waiting times due to Airbus’s existing backlog.

Boeing had experienced a sharp decline in orders following the January incident, marking its worst month for orders since the pandemic began. However, the company did manage a modest recovery with 15 orders in February, although still below typical monthly sales volumes.

The order from American Airlines is a critical vote of confidence for Boeing, which has struggled with quality control issues and certification delays. In the aerospace industry, it is not uncommon for orders to be placed before a model is certified, but typically not under such uncertain circumstances regarding the aircraft’s approval status.

Furthermore, Boeing disclosed that it delivered only 24 of the 737 Max jets and five 787 Dreamliners in March, with production rates impacted by ongoing quality control investigations. This slowdown has affected airline operations, prompting carriers like United Airlines to pause pilot hiring and ask some pilots to take voluntary unpaid leave.

Overall, despite the challenges, Boeing’s recent orders, including a notable one from American Airlines, suggest a cautious optimism for recovery in its commercial jet program, with ongoing efforts to resolve the quality and certification issues that have recently plagued the company.

Sources: AirGuide Business airguide.info, bing.com, cnn.com