Southwest Airlines confirmed today that it ordered 34 737-7s with the intention of receiving them by 2022, in view of a recovery in demand from the evolution of the health situation in the United States. With this additional, the total -7 count requested by Southwest is 234.
The company reduced its losses by a third in the second quarter, and expects the recovery in demand for leisure travel to accompany the summer season, while the return of business travel still has a long way to go.
For Boeing, this new order reinforces the previously weak position of the smaller variant of the MAX family, as several operators converted their orders from -7 to -8.
It is not news that Southwest comes to the rescue of Boeing: it has happened several times in the history of the operator. More than once it bought units rejected by another airline, or signed letters to support the image of the manufacturer in difficult times.
Beginning with the MAX crisis, Southwest became a major creditor to Boeing for outstanding penalties and fines with one of its largest customers. Therefore, these additional 737-7s are expected to arrive at a greatly reduced price to the fleet.
While this allows Boeing not to disburse cash at a critical time, it implies that the production line will be committed to assembling aircraft that will have less impact on the Renton giant’s economic recovery.
It is understood then the rush to increase the production rate to 42 aircraft per month, to free backlog and get a good amount of millions of dollars that were missing in these two years.
On the other hand, the idea of the company is to offer a new design aircraft to compete with the A321XLR, so it will have to free its production chain as soon as possible and must decide if the 737-10 is finally incorporated into the portfolio or if the new plane will take that market share.
