More B737 MAX cancellations as COVID-19 spoils chances of come-back, says GlobalData

Following the release of Boeing’s order book for the month of April 2020;

Nicolas Jouan, Aerospace and Defense Analyst at GlobalData, a leading data and analytics company, offers his view on the situation:

“Boeing’s order book for April is showing lasting effects of the COVID-19 outbreak on the commercial aerospace market. The company did not register any new orders for the entire month, and the B737 MAX is now standing at -281 orders net of cancellations for the year 2020. The model was already in a position of weakness when the COVID-19 outbreak wiped off demand for air travel at the beginning of the year.

“All B737 MAX are still grounded following two successive crashes and suspicion of technical issues. The collapse of oil prices since the OPEC-Russia spat also relativized the importance of the MAX’s fuel-efficient engines, just like for Airbus’ A320neo.

“In spite of reality, Boeing has been overly optimistic regarding the future of the MAX, tabling on a return to flight sometimes in 2020. Companies such as Air Canada or Air Lease Corporation cancelled orders in the double-digit earlier this year without directly invoking COVID-19 disruptions. It is now clear that the pandemic is not the sole cause of the MAX’s troubles, as Airbus decided in the meantime to cut the production the A320neo by 40%, more than for the A330 and A350 (-30% both). The fact is that an increasing number of airlines and leasing companies try to slim down their fleets, and the B737 MAX is a target of choice regardless of COVID-19 disruptions or grounding regulations by aviation authorities.”

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