US carrier Alaska Airlines estimates the grounding of its Boeing 737 Max 9s following the 5 January door plug blow-out on flight 1282 resulted in lost profits of at least $150 million.
However, the carrier disclosed in a 12 March filing with the US Securities and Exchange Commission that its first-quarter performance ”is now on track to exceed the expectations we held coming into the year”.
”Those expectations for improved Q1 results were driven by strategic network adjustments implemented by our commercial teams, and further supported by strong demand in the quarter,” says the Seattle-headquartered carrier.
Alaska says it would have seen a year-on-year profit improvement of 30% in the first quarter absent the Max 9 grounding. It has received compensation from Boeing, which will be reflected in its first-quarter earnings report.
”Given recent strength in demand through spring break travel periods and continued recovery of West Coast business travel, we now expect an even greater year-over-year improvement in Q1 2024 profitability,” it says.
Alaska stands to be impacted throughout 2024 by Boeing’s ongoing quality and production issues, which have resonated throughout the airline industry and badly delayed 737 Max deliveries for rival US carriers such as Southwest Airlines and United Airlines.
“Full-year capacity expectations are still in flux due to uncertainty around the timing of aircraft deliveries as a result of increased Federal Aviation Administration and Department of Justice scrutiny on Boeing and its operations,” it says.
Alaska holds 80 unfilled orders for 737 Max jets, including 43 orders for the still-uncertificated Max 10, Cirium fleets data show.
Alaska voluntarily grounded all 65 of its 737 Max 9s following the 5 January mid-flight blow-out of a door plug, before the FAA ordered most of the global fleet out of service. The jets were grounded for about a month while Alaska, Boeing and the FAA completed door plug inspections.
While it had been cancelling 110-150 daily flights in the absence of its Max 9s, Alaska says it has since rebounded operationally.
”Following the challenges we faced with Flight 1282 and the Boeing 737-9 MAX grounding in January and early February, we have returned our fleet safely to service and restored our schedule,” it says.
