Boeing’s top Chinese customer axes 737 Max from fleet plans

Bloomberg

Boeing Co’s biggest airline customer in China has removed more than 100 of the US manufacturer’s 737 Max jets from its fleet plans, citing uncertainty over deliveries.
China Southern Airlines Co Chairman Ma Xu Lun said at an investor briefing that Boeing’s updated best-selling aircraft would be excluded from fleet deliveries through 2024. The carrier expects to take delivery of 78 aircraft in total over the period, down from 181 in a previous forecast in March.
An investor relations representative for the airline said the Max wasn’t included due to
“uncertainty surrounding the delivery,” without providing further details.
The move is a sharp reversal for China Southern, which had outlined plans to rapidly expand its 737 Max fleet, saying in its annual report in March that 39 were due to arrive this year, building toward a total of 103 deliveries through 2024. It’s a reminder of the uncertainty shrouding a key market for Boeing as it works to reap cash from more than 300 Max that were built but never delivered due to a global grounding.
None of China’s state-owned carriers have said if or when they might resume taking the Max once it is officially back in service. China was the first to ground the Max in March 2019 following fatal crashes in Indonesia and Ethiopia that combined killed 346 people. Brian West, Boeing’s chief financial officer, said that Max aircraft were on the verge of returning to regular airline service before a Covid outbreak decimated air travel in China earlier this year.
“There was great progress with the local team, the Chinese customers, the Chinese regulators. They were clicking along, checking all the boxes and then Covid hit with different protocols and restrictions,” West told a Goldman Sachs conference. “We assume that when they can get back and focused on this, they will pick right up where we left off,” with deliveries eventually following, he added.
China Southern forecast in 2019 it would be operating 523 jets from Boeing’s narrowbody family by this year, most of which would have been Max aircraft. At the end of 2021, the airline had a fleet of 399 Boeing narrowbodies, according to its latest annual report.