Today’s news from Southwest Airlines generated a lot of reactions across the trade and news media to slowing MAX deliveries. We want to offer some context.
Here’s the big picture from January 2021. The grounding of the MAX was awful for the airline’s fleet planning. Moreover, Southwest is focused on one aircraft type – the Boeing 737. This is not unique; Ryanair is the same way, for example. But this choice puts the airline at risk when the OEM goes wobbly. And the MAX has seen a few of those. In 2023 (through today), Southwest has been getting a new MAX delivery, on average, every three days. That is an incredible pace and reflects how badly the airline needs these new aircraft.
Using data from ch-Aviation, here is Southwest’s current fleet. The aircraft to be delivered is 43% of the current fleet. Another data point to note: Over half the active fleet is the -700. This 140-seater is the core of Southwest’s business, and that is what they need to replace.
Among active aircraft, the -700s average 18.1 years old. This compares to 7.7 for -800s and 2.2 for the MAX. Besides the newer aircraft delivering better economics, they are much more fuel efficient. Older 737s have run into challenges with fuselage cracks. It has been a while since this news has been repeated. But there was news in November last year cracking again. We are aware that internally there is concern about the MAX7 certification process because the airline does not want to spend money on fixing their -700s which they cannot recoup before MAX7 deliveries. Many of the MAX8s being delivered should be MAX7s.
Instead of the 100 new MAXs Southwest expected in 2023, they now expect to receive 70. This sounds rough – but that is still a new MAX every five days! Which is still an incredible rate. Even at a rate of 100 deliveries this year, the aging -700s problem would not be solved.
So who’s at fault here? Boeing owns some of this, for sure. But they don’t own all of it. Southwest doubled down on the 737 when they could have de-risked their business.
