The MAX overhang |

It appears that the MAX grounding is working towards a resolution. The meeting of international regulators on May 23rd will review what the various working groups and committees have found and try to find common ground for a reinstatement decision. There are rumors that the FAA may decide to go it alone and approve operations again even if some other countries disagree. It seems implausible they could be the only agency to do so. News from COPA in Panama suggests they expect to fly their MAXs in July. Maybe the decision will be sooner than some think. But until we hear from each agency, it is difficult to predict the future. Unfortunately, politics also can enter into the process. Canada, we suspect, will want to conduct its own certification process. While there is no obvious connection, Canada still seethes over the ITC case that essentially drove Bombardier out of the commercial aerospace business. Boeing Karma has boomeranged China was the first country to ground the MAX. Everything with China has to do with politics, so the current US/China trade spat does not help Boeing at all. We would not be surprised to see China demand to do its own certification of the MAX. This would be a superb opportunity for that agency to flex its muscles after leading the MAX grounding effort. It is also a great opportunity to send a message to the White House. It is always about power with China. Canada, we suspect, will want to conduct its own certification process. While there is no obvious connection, Canada still seethes over the ITC case that essentially drove Bombardier out of the commercial aerospace business. Karma. What does the MAX order book look like? The chart lists Boeing's MAX orders, all family members grouped by one label. The proportion of orders going to 'Unidentified" is not insignificant. Cumulatively, Unidentified is by far the biggest customer. The next chart shows the Top 20 MAX customers by orders and how many have been delivered. From this list, we need to remove Jet Airways and this is likely to show up when Boeing refreshes their data for April. There may be others coming, see here and here. However, we think that inside that big Unidentified overhang there may be some cracks. Look at the O&D this way. Even if the FAA decides to go it alone, that does not help airlines and lessors with aircraft operating outside the US. The key countries here are China and India. India has seen about half the MAX orders lost because of Jet. Not a MAX problem per se, but still a problem. We have yet to see the dust settle from Lion Air. The MAX order book is perhaps not as solid as it appears. China was the first country to ground the MAX. Everything with China has to do with politics, so the current US/China trade spat does not help Boeing at all. We would not be surprised to see China demand to do its own certification of the MAX. This would be a superb opportunity for that agency to flex its muscles after leading the MAX grounding effort. It is also a great opportunity to send a message to the White House. It is always about politics with China. With the FAA's reach and influence more limited than ever, the MAX return to service outside the US will continue to disrupt airline schedules. Which means airlines will seek to de-risk their fleet plans as they hunt for NGs and, yes, possibly even Airbus aircraft. Whether this is permanent or temporary lift we don't know. But the lesson from MAX is that sticking with one OEM and one model does not de-risk an airline. The economies of scale may be attractive, but one must way up the risk.

US Flight Planner - US DoT On-Time Data	Airbus vs Boeing - Official OEM Data
US Airline Schedule Performance - US DoT Data	Daily OEM Production & Deliveries -

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