Daily Insight: Friday 28 June 2019: MAX Grounding Impacting the Leasing Market

News

Industry sources indicate that aircraft lessors are looking at 12 month lease extensions for Boeing 737-800s from the September-October timeframe, when many extended lease for six months due to the 737 MAX grounding to maintain interim lift for airline customers expire.  This compounds both the decision processes for airline fleet planners as well as potential impacts the Boeing 737 MAX delivery skyline once deliveries resume.

Analysis

If you are an airline and your MAX is grounded, you need interim lift to maintain your schedule.  While in many cases MAX arrivals were for growth, in others they were to replace older aircraft.  Keeping those older aircraft on the flight line could require a lease extension, and most lessors provided six month extension to their customers.