Insight: Monday 15 July 2019 – A MAX by any other name…

News Reports surfacing this weekend indicate that Ryanair is re-branding the MAX on its fuselage from 737 MAX to 737-8200. A plane-spotter took photographs of one of the latest models in Seattle showing the new name, and Tweeted the photographs, as shown below: This follows IAG not mentioning the word MAX in the press release it issued after placing a letter of intent for 200 aircraft at the Paris Air Show, instead using the 737-8 and 737-10 model designations without the word MAX. Analysis It is obvious that airline market research is showing a negative connotation to the word MAX, and that customers may seek to book around this aircraft. Of course, in an era of social media, the question is how quickly the 737-8200 will quickly be known as a MAX, whether Ryanair likes it or not. The same goes for the 737-8 and -10 designations for BA. The MAX name simply won’t be as obvious after a re-branding, which Boeing, surprisingly, has not yet done.If Boeing’s customers are starting to re-brand the aircraft, Boeing itself will likely be forced to follow. Airlines would be uncomfortable if Boeing links the model number to the word MAX in their designations, and would probably prefer Boeing drop the MAX designation completely. Fortunately, Boeing hasn’t utilized this term for other aircraft -- the 777X is not being called the 777MAX. With the MAX designation limited to one aircraft type, Boeing would be well advised to drop the MAX designation from the 737 name. Insight Our view is that in time, Boeing will also be forced to drop the MAX nomenclature, as a result of the negative image with the flying public. It is difficult to sustain a damaged brand in the market, and the introduction of improvements provide a re-branding opportunity as a “new and improved” airplane. The text-book Tylenol crisis was different, and Johnson and Johnson took decisive action to keep their brand positive. Boeing did not do so, and allowed negative media reports to pile-up as additional problems were discovered with the aircraft after a closer examination, further damaging the image of the aircraft.The reaction of the flying public to a brand change could go two ways. If successful, people will know they are on an “improved” aircraft that has been vetted by multiple certification authorities, making it one of the most examined and safe aircraft in the sky. If not, people will identify the new models as the MAX, and book around them for other aircraft types when possible.We believe the latter will occur, for at least six months, after the aircraft re-enters service. Boeing has plenty of time to consider a re-branding before the aircraft re-enters service in 2020 (we’re predicting second quarter). In the past, the public has generally forgotten about aircraft reputations and stopped booking around them (i.e. DC-10) - but that was in the days before social media. Times have changed, and constant reminders on-line could change behaviors this time around.

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