American Airlines is in talks with Boeing to potentially defer 18 737 MAX aircraft scheduled for delivery in 2021, as the airline looks to conserve cash amid the extended industry downturn caused by the COVID-19 pandemic.
Fort Worth-based American had 24 MAX 8s in its fleet when the type was grounded in March 2019, following two fatal accidents that killed 346 people within five months. A further 18 planes have already been built by Boeing and remain undelivered, bringing the tentative total to 42.
The potential deferrals, announced Sept. 9 during an investor conference hosted by Cowen & Co., relate to an additional 18 MAXs that would take American’s total up to 60 aircraft by year end 2021. American CFO Derek Kerr said nothing firm has been agreed on yet, adding the company will likely have an update in time for its 2020 third-quarter earnings call in October.
American has retired more than 150 jets in 2020, including five entire fleet types—its Airbus A330-300s, Boeing 757-200s, 767-300ERs, Embraer E190s and Bombardier CRJ200s—in addition to some of its older 737 NGs and A320ceos. As Kerr explained, the departures leave the airline with a much-simplified fleet consisting of just four core jetliner families; the 737 and A320 on the narrowbody side, and the 777 and 787 on the widebody side.
“By getting our mainline fleet rationalized down to four main aircraft types, we’ve dramatically simplified the airline in terms of maintenance, flight operations and pilot training,” Kerr said.
Kerr also reported that American still plans to pursue a $4.75 billion low-interest government loan it qualified for under the CARES Act, which is separate from the federal aid it received from the Payroll Support Program. Observing that other carriers have opted to forego their secondary loans, Kerr said American may potentially be able to seek an even larger loan from the U.S. Treasury Department.
“We know that Southwest is not taking the loan ... They have already announced they’re not taking the loan, so there may be a possibility for us to do that,” Kerr said.
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