United Airlines Buys 25 New Boeing 737 MAX Jets
March 01 2021 - 11:40AM
Dow Jones News
By Alison Sider
United Airlines Holdings Inc. said it is buying 25 new Boeing
737 MAX jets and bumping up its orders for dozens more as it
positions its fleet for a travel rebound.
The deal is a boost for Boeing Co., which has lost hundreds of
MAX orders amid a nearly two-year grounding following two fatal
crashes of the jet. The U.S. in November approved the MAX for
passenger flights again, laying out requirements including that the
plane undergo software updates and that pilots go through
additional training.
Andrew Nocella, United's chief commercial officer, said in a
memo Monday that the MAX will be key to the company's long-term
growth and its ability to serve demand, which it expects to rebound
in the coming years, as it starts to replace aging aircraft that
are nearing retirement. United began flying passengers on the MAX
again earlier this month.
United didn't disclose financial terms of the deal. The MAX
sells for $122 million to $135 million at list prices depending on
the model, though airlines typically receive discounts for large
orders.
Mr. Nocella said United is still lobbying for a third round of
federal aid to avert job losses at the end of March, but needs to
place aircraft orders over a year in advance of taking delivery.
The 25 newly ordered planes are slated for delivery in 2023.
Regulators around the world grounded the jet in March, 2019
after two fatal crashes that killed 346 people. Regulators in
Europe, Canada, and other regions have cleared the plane to fly
again.
Boeing said customers canceled orders for 511 MAX jets last
year, with hundreds more in question as the coronavirus pandemic
has reduced demand for travel and forced airlines around the world
into retreat. Many have been able to walk away from their orders
without penalty, as generally allowed by Boeing contracts, because
their deliveries were more than a year late due to the
grounding.
Other carriers have added to their MAX orders. Ryanair Holdings
PLC said in December it had agreed to buy 75 new MAX jets from
Boeing. Alaska Air Group Inc. added to its MAX order last year,
opting to replace most of its Airbus planes in the coming years
with MAX jets.
United said Monday that it would move up the delivery of 40
previously ordered MAX jets to 2022 and bring forward another five
deliveries to 2023. In total, United has 188 firm commitments for
MAX planes in the coming years, according to a regulatory filing
Monday.
The airline said in the regulatory filing that it expects to
receive 11 of Boeing's 787 Dreamliner wide-body jets this year,
including three delayed from the final quarter of 2020. Boeing
hasn't delivered a Dreamliner since October, hamstrung by
inspections and rework linked to production problems. That has
built up a backlog of dozens of Dreamliners even as it cuts monthly
production to five. Boeing has said it still aims to resume
deliveries this quarter.
Doug Cameron contributed to this article.
Write to Alison Sider at alison.sider@wsj.com
(END) Dow Jones Newswires
March 01, 2021 11:25 ET (16:25 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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