Southwest Airlines Facing Losses Due To Boeing 737 Max Grounding

Credit: AP

Southwest Airlines won’t be flying Boeing 737 aircraft any time soon, and it’s already having an impact on their profits.

Southwest Airlines announced on Thursday that it’ll not be flying the grounded 737 MAX until at least next year. The airline also warned of higher-than-expected costs which have resulted from its inability to fly the grounded planes. At the same time, the airline announced that it’ll no longer be operating in Newark Liberty International Airport this November as the grounding drags on for longer than expected.

Now that the company won’t be flying 737 MAX jets until next year, Southwest is the most hesitant airline to fly the planes again. As a low-cost carrier, Southwest and its customers will likely face flight cancellations and higher ticket prices by the end of the year. It is clear based on Southwest Airline’s reaction that like many other airlines it didn’t expect the 737 MAX to be so troubled for so long.

American Airlines reported a $175 million hit in the second quarter due to cancellations it had to make due to grounded 737 MAX planes during the second quarter. The groundings are expected to cost American Airlines up to $400 million for 2019, and it’ll likely be quite costly for other airlines as well.

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