U.S. plane manufacturer Boeing announced the appointment of Michael Luttig (64) to the newly-created position of counselor and senior adviser. Simultaneously to this decision, Asian carriers have scaled back routes and are rethinking expansion plans as a result of the grounding of their fleets of Boeing 737 MAX 8 aircraft following two fatal crashes.
Luttig, who will report directly to Boeing Chairman, President and CEO Dennis Muilenburg, has been hired to deal specifically with legal issues related to the 737 MAX 8 crashes. A number of lawsuits have already been filed against Boeing in the federal district court in Chicago by family members of victims who lost their lives in the two deadly crashes. Insiders suggest that the Chicago-based plane maker will face several additional lawsuits, including compensation requests from airlines.
Lion Air might cancel its MAX 8 orders, CAPA indicates
Among the Asian airlines that are revisiting their routes and expansion plans is Indonesia's Lion Air, which was launch customer for the 737 MAX 8 and its variants and the first carrier to experience a fatal 737 MAX 8 crash. According to aviation consultancy CAPA, Lion Air is considering a potential cancellation of its 737 MAX orders.
Several Chinese carriers are also re-evaluating the future of their fleets. Among them Air China, China Eastern, China Southern (which placed an order for 50 737 MAX 8s) and Hainan Airlines - a unit of the financially-troubled HNA Group.
SCOOT to suspend routes
Meanwhile, Singapore Airlines' budget carrier subsidiary Scoot announced this week it would suspend four routes from late June due to a shortage of aircraft. Its parent has had to halt plans to expand Scoot's fleet with the transfer of older 737s as its regional sister airline, SilkAir, which ordered 37 B737 MAX 8s will not now receive the new jets it had expected. SilkAir has also had to cancel flights.
Other Asian carriers affected by the 737 MAX 8 grounding include Korean Air (30 MAX 8s), Jeju Air (40 MAX 8s), VietJet (120 MAX 8s) and India's Jet Airways (125 MAX 8s), - which is facing bankruptcy - while according to Wikipedia, Indonesian flag-carrier Garuda has cancelled its order for 49 MAX 8s.
Meanwhile, media reports suggest that state-owned low-cost airline Flydubai is negotiating a potential purchase of new А320 Neo jets produced by Airbus to replace its Boeing 737 MAX planes.
The MAX 8 disaster could become extremely costly for Boeing
According to Flydubai, the second largest customer of the B737 MAX jets with a total order of 250 MAX variants, including 131 MAX 8s, the current uncertainty around MAX 8s has forced it to look at alternatives. The carrier was forced to ground the entire fleet of 14 MAXs after directives from the UAE aviation regulator and it has joined the list of global airlines demanding compensation from Boeing. The step triggered “a disturbance and a number of shrinking of routes,” according to the carrier.
No timeline yet for the MAX 8s to resume flights
Although reports say that Boeing is racing to fix the software problem that affected the aircraft's anti-stall system and Boeing's Muilenburg last week stated that the company is close to completing an update to the flight control software, while stressing that the aircraft will be "among the safest planes ever to fly,'' there is still no timeline for its return given the ongoing crash investigations and the software fix, which requires the blessing of the Federal Aviation Administration and additional pilot training.
Equally important is that passengers will likely need more convincing, presenting a major challenge to all MAX 8 airlines when the planes return to their flight schedules.
Nol van Fenema