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We have a new model from which to share insights. We built a MAX delivery model, which is now being updated daily. Since the model is a work in progress, we will keep refining it. Meanwhile, here is a first pass.
Since the program has seen interruptions, deliveries do not match production, as with other models. The next chfollowingillustrates a wide variance in the days between the first flight and delivery.
It is impressive how Boeing moved through the first large-scale disruption and accelerated deliveries. When looking at deliveries, there’s a pre-2020 era where production was accelerating, and deliveries were humming. Then came the two crashes and the grounding. This caused deliveries to stop and inventory to build as Boeing tried to keep its supply chain functioning. This was a big challenge as it came simultaneously with the pandemic. Indeed, Indeed, a perfect storm.
What is fascinating is how Boeing moved aircraft to customers throughout the pandemic and after. Customers were handled differently. This could have been a negotiation between Boeing, the operator, and a lessor where appropriate. Here are some examples of the average delivery aging (first flight to delivery date).
FlyDubai numbers look great. Qatar Airways, not so much, but then again, industry watchers will recall that period and its unique personalities.
The Asian market was most disrupted because China was the first to ground MAX operations. The pre-pandemic/grounding period is efficient with low average delivery aging.
Note that the Akasa fleet, with a high average aging as parked aircraft meant for Chinese operators, was diverted to India. This was a big win for Akasa as it grew its fleet at an impossible rate without grounding disruptions. One door closes, and another door opens. Air India benefitted the same way.
Europe is the third largest MAX market after North America and Asia. Ryanair is the weather vane operator in this market. The grounding hugely disrupted Ryanair, but delivery aging dropped quickly over the past two years. That does not mean the airline gets the delivery rates it wants and expects.
Over 44% of MAX deliveries go into this market, surpassing Asia’s next most significant market, 19.6%. Once again, note the smooth deliveries pre-grounding and pandemic. Southwest is the weather vane in this market, followed closely by United and Alaska.
Of these three, Alaska has the lowest delivery age, and United has the highest. Southwest took almost one MAX 8 every four days last year, but that’s not the model it wants most. However, the absence of the MAX 7 worked out well for Southwest because it has been able to use that extra MAX 8 capacity. With load factors over 80%, the additional 22 seats brought welcome revenue as the US domestic travel market rapidly recovered.
The Air Canada 2024 delivery is a convenient opportunity to grab an airplane (C-FFOP) initially meant for Lynx. Indian operators are not the only ones jumping on deals when they can find them.
As we work through the model, we will share more insights.
