Boeing 737 MAX 7 delivery delayed to 2024 -US SEC filing.

Boeing 737 MAX 7 delivery delayed to 2024 -US SEC filing.

Boeing’s Delivery of 737 MAX 7 Delayed to 2024, Impacting Southwest Airlines and Boeing’s Competitiveness against Airbus

Boeing 737 MAX 7

Boeing’s highly anticipated delivery of the 737 MAX 7 has been pushed back to 2024, as revealed in an SEC filing on Wednesday. This delay brings additional challenges and implications for both Boeing and its launch customer, Southwest Airlines. The MAX 7, alongside the MAX 10, plays a crucial role in Boeing’s pursuit to compete with its rival, Airbus, in the narrowbody market.

Boeing remains hopeful that the Federal Aviation Administration (FAA) will grant certification for the MAX 7 and commence FAA certification flight testing for the MAX 10 sometime in 2023. The MAX 10, currently scheduled for first delivery in 2024, aims to challenge Airbus’ popular A321 neo. Meanwhile, the MAX 7 competes with Airbus’ A220.

However, the delay in delivering the MAX 7 to Southwest Airlines, its exclusive operator, will prolong its entry into service, initially planned for 2022. This setback may hinder Southwest Airlines’ expansion plans, as the airline heavily relies on the 737 fleet. Despite the disappointment caused by the delay, Boeing’s shares experienced a significant boost of 7.7% following the release of second-quarter results that surpassed Wall Street consensus.

The delay in MAX 7 certification stems from an ongoing back-and-forth between Boeing and the FAA regarding safety management system paperwork. Sources reveal that there is currently no clear timetable for the FAA’s approval of Boeing’s submissions. The FAA, emphasizing safety as the top priority, refrains from discussing ongoing certification projects.

Boeing CEO Dave Calhoun previously projected that the first delivery of the MAX 7 would occur this year, followed by the MAX 10 in the next. However, in May, Mike Fleming, Boeing’s senior vice president for commercial development programs, acknowledged that MAX 7 certification was taking longer than expected due to new documentation requirements.

The MAX 10 represents Boeing’s answer to the success of Airbus’ A321 neo, which has consistently outperformed the MAX 9 in various competitions. While the smaller MAX 7 aims to compete with Airbus’ A220, the MAX 10 targets larger capacity segments of the narrowbody market.

Southwest Airlines CEO Bob Jordan expressed in March that the airline did not anticipate putting the MAX 7 into service until 2023, as the process could take up to six months from delivery. The best-case scenario was an early 2024 entry into service. Similarly, Alaska Airlines CEO Ben Minicucci shared last month that they were “anxious” to start taking deliveries of the larger Boeing 737 MAX 10 once it received certification.

To obtain approval for the MAX 10, Boeing must first secure FAA certification for the smaller MAX 7. Regulatory scrutiny has intensified following the MAX 8’s fatal crashes in 2018 and 2019, leading to significant delays for both the MAX 7 and MAX 10.

Overall, the delay in the delivery of Boeing’s 737 MAX 7 to Southwest Airlines brings challenges for both companies. Boeing’s competitiveness against Airbus may be impacted, especially in the top and bottom segments of the narrowbody market. However, the positive response to Boeing’s second-quarter results highlights optimism in their ability to overcome these hurdles and achieve certification for the MAX 7 and MAX 10. The aerospace industry eagerly awaits further updates on the progress and ultimate launch of Boeing’s 737 MAX variants.