Issue No. 711

The Aftermath of the 737 MAX 8 Grounding

All B737 MAX jets worldwide remain grounded—and might for some time—following the crash of an Ethiopian Airlines MAX 8, which killed all 157 people aboard. The crash, it seemed, was similar enough to a Lion Air MAX 8 crash last year to warrant the grounding.

In that case, a system called MCAS—designed partly to prevent a crash (by lowering the plane’s nose when it seemed to be stalling, in order to regain airspeed)—instead seemed to contribute to the crash. Because of faulty readings, the system engaged when it shouldn’t. Lion Air also didn’t take the plane out of service after it experienced similar problems the previous day. Some pilots around the world complained Boeing hadn’t done enough to educate them about the way the system worked and how to override it when necessary.

The precise cause of the Ethiopian Airlines crash is less clear, but a new generation of satellite ADS-B data helped convince airlines and civil aviation authorities around the world, followed ultimately by the FAA and Boeing, that the crashes were too similar to keep the MAXs in the air. With 34 MAX 8s, according to ch-aviation, Southwest has more of the newly-engined jets than any other carrier. But they represent just 4% of its total fleet, so the grounding could have just a modest impact if the issue is addressed within the next few weeks or months. United, for its part, with 14 MAX 9s, said explicitly that it’s seeing no significant financial or operational impact but would if the groundings extend into the peak summer.

For a highly summer-dependent carrier like TUI, with 15 MAXs, an extended grounding into the peak season would be particularly hurtful. American, by the way, is the world’s second largest MAX operator after Southwest, tied with Air Canada in that regard—both have 24. But Air Canada is a smaller airline—the MAXs represent nearly 20% of all its narrowbody aircraft—and it reacted by suspending its financial guidance for 2019.

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