American Airlines cancels flights on Boeing's embattled 737 Max through September as the carrier's $350 million headache gets worse
Drew Angerer/Getty Images
Drew Angerer/Getty Images
- American Airlines said Sunday it will cancel 115 flights per day because of the grounding of the Boeing 737 Max plane.
- The Dallas-based carrier originally canceled flights on the embattled plane through August, saying it would take a $350 million financial hit. The 737 Max jets have experienced two separate deadly crashes months apart, which prompted authorities to ground the aircraft globally.
- Many airlines have begun to consider asking Boeing for compensation as their bottom lines take a beating because of the ordeal.
- Visit Business Insider's homepage for more stories.
Every day that Boeing's 737 Max plane remains grounded, as it has been since April, throws a wrench into 115 daily flights operated by American Airlines.
The carrier on Sunday announced it would extend cancellations for flights scheduled for the 737 Max plane through September while it and other airlines around the world await a software fix from Boeing to be approved by the Federal Aviation Administration.
"American Airlines remains confident that impending software updates to the Boeing 737 MAX, along with the new training elements Boeing is developing in coordination with our union partners, will lead to recertification of the aircraft soon," the company said in a press release.
"We have been in continuous contact with the Federal Aviation Administration (FAA), Department of Transportation (DOT), National Transportation Safety Board (NTSB) and other regulatory authorities, and we are pleased with the progress to date."
In April, American canceled the 115 daily flights, or 1.5 percent of its daily scheduled service, through August. In that announcement, the Dallas-based company also said the flight disruptions would cost it $350 million.
American owns 24 of the Max jets and has 16 more on order.
Other carriers that use the Boeing 737 Max, like Southwest and Norwegian, have estimated the financial impact from the grounding to be $200 million and $58 million, respectively. Many other airlines are ready to pursue compensation from Boeing as a result of the disruptions.
Wall Street analysts aren't convinced the plane will return to service until at least July, so the costs for airlines will likely keep piling up.
"We continue to expect an end of July ungrounding with a certification of the new software a few weeks prior," Myles Walton, an analyst at UBS, told clients in a note last week.
More Boeing 737 news:
- Behind Boeing's offer to settle with victims' families in a 737 Max crash is a hardball legal strategy that could leave them with nothing
- Qatar Airways is joining the growing number of airlines demanding payback from Boeing for its 737 Max disasters - here's the full list
- Boeing is in talks to settle with families suing it over 737 Max crash deaths and avoid a potentially excruciating trial
- Here are all the investigations and lawsuits that Boeing and the FAA are facing after the 737 Max crashes killed almost 350 people
Get the latest Boeing stock price here.