- It’s not simply Boeing. Airlines are going through huge losses as nicely.
- Southwest Airlines and American Airlines posted losses within the first quarter of 2024.
- Southwest CEO Bob Jordan stated Boeing’s plane supply delays “are very painful.”
Boeing is not the one firm grappling with turmoil within the aviation business.
On Thursday, Southwest Airlines and American Airlines reported losses of their quarterly earnings name.
Southwest Airlines stated it might be ceasing flights to 4 airports —Bellingham International Airport, Cozumel International Airport, George Bush Intercontinental Airport, and Syracuse Hancock International Airport — from early August after a $231 million loss within the first quarter of 2024.
Southwest Airlines CEO Bob Jordan instructed CNBC the choice to stop flights had “nothing to do” with Boeing’s plane supply delays. But the delays, Jordan stated, did damage Southwest in different methods.
“Now the Boeing delays are very painful. They cause us to replan, they hurt us on the revenue front, they cause us to be inefficient, and we’re working all of that,” he instructed CNBC on Thursday.
Besides decreasing flights, Southwest additionally stated it might minimize down on hiring. The airline stated it expects to finish this yr with about 2,000 fewer workers than on the finish of 2023.
American Airlines, in the meantime, posted a lack of $312 million in its first quarter amid rising labor prices.
American Airlines CEO Robert Isom instructed CNBC on Thursday that whereas they’ll obtain about seven fewer plane from Boeing as a result of delays, the discount in capability is not going to have a “material impact” on the airline.
But Isom did specific his disappointment at Boeing throughout his firm’s earnings name.
“I’ve talked to everyone at Boeing that I can possibly address and the message is the same: Get your act together,” Isom instructed buyers on Thursday.
When requested about Isom’s remarks, Boeing pointed BI to a remark made by its CFO Brian West on March 20 on the Bank of America Global Industrials Conference. West instructed convention attendees then that Boeing was “in regular, very transparent communications” with their shoppers.
“The most important thing we do is communicate with them. And they have been supportive of everything we’re trying to do to enhance safety and quality for the industry,” West stated.
Representatives for Southwest Airlines and American Airlines did not instantly reply to a request for remark from BI despatched exterior common enterprise hours.
Boeing has come underneath fireplace not too long ago following repeated high quality management lapses. On January 5, a plug door flew off a two-month-old Boeing 737 Max 9 throughout an Alaskan Airlines flight from Oregon to California.
On Wednesday, Boeing stated throughout its earnings name that it had burned by way of $3.9 billion in money within the first quarter of 2024. The firm additionally posted a web lack of $355 million in its newest quarter.
“Near term, yes, we are in a tough moment,” Boeing CEO Dave Calhoun stated in a letter to workers on the identical day.
“Lower deliveries can be difficult for our customers and for our financials. But safety and quality must and will come above all else,” he continued.