Southwest Airlines (LUV) United Airlines (UAL) and American Airlines (AAL) have all cancelled flights that continued to be booked on Boeing 737 Max aircraft (BA) despite the Federal Aviation Administration’s decision earlier this year to ground the planes in the wake of two fatal crashes.
Issues with the computer system onboard the 737 Max aircraft were identified as a cause of the crashes of a Lion Air flight and an Ethiopian Airlines flight. More than 300 people died in the two crashes, and the incidents prompted airline regulators around the world to ground the aircraft.
On Wednesday, the FAA found more problems with the 737 Max’s software, which will further delay the process of bringing the aircraft back into service.
Southwest Airlines, which has 34 of the aircraft in its fleet, has cancelled flights that were scheduled to be flown on those planes through Oct. 1, the airline announced on Thursday. Previously, Southwest had cancelled planned 737 Max flights through Sept. 2.
“By proactively removing the Max from scheduled service, we can reduce last-minute flight cancellations and unexpected disruptions,” the company said.
Roughly 150 daily flights will be affected, the company said. Affected consumers will be notified directly and will be able to change their itineraries at no additional charge.
‘Anytime you have less availability and increased demand, higher fares tend to follow.’ — —Tracy Stewart, content editor at Airfarewatchdog.com
United Airlines, which has 14 Max aircraft in its fleet, announced Wednesday that it is cancelling flights that were set to take place with these planes through Sept. 3. That equates to around 1,290 flights in July (between 40 and 45 flights a day) and 1,900 flights in August (roughly 60 flights a day).
The company said it has worked to minimize the impact on consumers who have already booked flights by swapping the Max aircraft out for other planes in its fleet. “It’s harder to make those changes at the peak of the busy summer travel season,” the company said.
Consumers will be automatically booked on alternate flights whenever possible — and when unable, United said it will reach out to these travelers and offer other options.
Earlier in June, American Airlines announced that it would cancel flights through Sept. 3 that were meant to use Max aircraft, which amounts to roughly 115 flights per day. However, not all 737 Max flights will be cancelled, since the airline also plans to substitute other aircraft.
Affected customers will either be contacted by American or a travel agent (if they booked their trip with an agency). Consumers will have the option not to rebook and to receive a full refund.
Boeing told MarketWatch in a statement that the company is “supporting all of [its] customers around the world in every way possible to ensure complete confidence in the 737 Max and a safe return to commercial flight.”
Given the potential for future cancellations — and concerns travelers may have with the Boeing aircraft even when it returns to service — consumers can proactively find out whether a given itinerary is set to be flown on one of these planes.
Online travel agency Kayak (BKNG) added the option to filter itineraries by aircraft type in order to allow consumers to opt out of flying on the 737 Max. Other websites, such as Flightview.com and Flightaware.com, now also show what type of plane is planned to be used for a given flight.
However, airlines reserve the right to change which type of aircraft will be used for a given itinerary. Alternately, concerned consumers can book flights with a number of airlines that do not include the 737 Max in their fleet, including Delta Air Lines (DAL) Sun Country Airlines (APO) Hawaiian Airlines (HA) Spirit Airlines (SAVE) and Alaska Airlines (ALK)
The reduction in flights this summer, when demand for air travel is typically at its highest, could create headache for consumers. “Anytime you have less availability and increased demand, higher fares tend to follow,” said Tracy Stewart, content editor at travel site Airfarewatchdog.com (TRIP)
Consumer advocate and travel writer Christopher Elliott disagreed, arguing that the higher prices could prompt consumers to rethink their summer travel prices. Because airlines use dynamic pricing that adjusts with demand, fares could eventually drop in price — but that doesn’t mean airlines won’t attempt to claw back their losses.
“The airline business model is to hit us with ‘gotcha’ fees for luggage or changes after we’ve bought the cheap ticket,” Elliott said. “We may pay a Max ‘surcharge’ at some point, but if we do, it will be in the form of higher luggage fees or change fees.”
In the long run, the fallout from the Boeing 737 Max situation could have major ramifications for low-cost carriers, Stewart said. It could jeopardize new routes, including Southwest’s service to Hawaii.
Additionally, Norwegian Airlines (NWARF) which has 18 Max aircraft in its fleet, is likely in a similar bind. (Norwegian did not return a request for comment.)
Many low-cost carriers like Norwegian have resorted to renting chartered aircraft to fulfill flights meant to occur on Max planes. That comes at a cost.
“Norwegian was already in a precarious spot after an engine issue forced them to ground several 787 Dreamliners the previous year,” Stewart said. “With so many other low cost carriers, like Wow Air and Primera, dropping out of the picture recently, losing a big player like Norwegian would be a huge blow to competition, and fares to Europe would certainly go up.”
The Dow Jones U.S. Airlines Index (XX:DJUSAR) is up 7.64% over the last three months. Comparatively, the Dow Jones Industrial Average (DJIA) and the S&P 500 (SPX) are only up 3.15% and 3.89%, respectively, over the same period.
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