Southwest Extends Boeing 737 Max Flight Cancellations

Southwest Airlines Co. (NYSE: LUV) is extending cancellations of all flights involving the Boeing 737 MAX through September 2, about a month longer than expected. About 100 flights per day will be disrupted due to scheduling changes, the Company said. Southwest has 34 of the 737 Max jets in its fleet, the most of any U.S. airline.

The Dallas-based carrier “continues to await guidance from Boeing and the Federal Aviation Administration (FAA) on the impending 737 Max software enhancements and training requirements.” The Company said it is pleased with progress reported so far and remains confident the aircraft will fly again safely. Boeing Co. (NYSE: BA) is seeking approval from the FAA and international authorities for a software fix designed to address the Maneuvering Characteristics Augmentation System (MCAS). The MCAS, which automatically adjusts the nose of the plane based on a series of sensors, has been a central focus of investigation following Boeing’s two deadly crashes.

Although trouble with the 737 Max is extending into the busiest travel time of the year, industry trade group, Airlines for America, projects travel on U.S. airlines to rise for the tenth consecutive year. The organization expects a record 257.4 million passengers to fly on U.S airlines between June 1 and August 31, 2019. That number is up 3.4% from last summer’s record of 248.8 million passengers.

Shares of Southwest have gained nearly 12% this year versus its top three competitors, American Airlines Group Inc. (NASDAQ: AAL), up 2%, Delta Air Lines, Inc. (NYSE: DAL), up 13%, and United Continental Holdings, Inc. (NASDAQ: UAL), up 4%.

Last week, American Airlines extended its Boeing 737 related cancellations through September 3.

2 Comments
  1. Nico Padron 1 month ago
    Reply

    I’ll buy into $BA around the end of 2019.

  2. Ross Gerber 1 month ago
    Reply

    $LUV overvalued, it belongs >$50

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