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Southwest to take first 737 Max 8 in August

Southwest Airlines will take delivery of its first Boeing 737 Max 8 in August, ahead of planned revenue service on 1 October.

The Dallas-based carrier will have 10 737 Max 8s by October, said chief financial officer Tammy Romo on Southwest's second quarter earnings call earlier today. The airline continues to expect to end 2017 with 14 of the type.

Chief executive Gary Kelly says the airline does not expect any delivery delays, following a delay in Norwegian's first 737 Max delivery that was pushed back to late-June.

Southwest, the launch customer of the 737 Max, holds orders for 30 737 Max 7s and 170 Max 8s.

The low-cost giant is taking delivery of the 737 Max as it phases out its remaining 737 Classics. As of 25 July, the airline had 67 737 Classics that it will retire by the end of the third quarter. The Classics phase-out will mark the largest number of aircraft retirements in Southwest's history, says Romo.

Of the remaining 737 Classics, 21 aircraft are on operating leases. Southwest will incur a $60 million special item charge as a result of terminating these leases earlier.

Romo says additional charges could be incurred from work on the aircraft before their returns, but adds that this is not expected to be significant.

These charges were earlier taken into consideration in Southwest's forecast of an additional $200 million earnings before interest and tax, as a result of it accelerating the 737 Classics retirement.

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