Boeing’s 737 MAX series has taken a further blow with the announcement that GE Capital Aviation Services (GECAS) has cancelled its order for 69 of the type. The move is seen as part of a “mutually agreed rebalance” by the lessor during the pandemic crisis.
“We have had ongoing conversations with GECAS regarding their 737 MAX portfolio and the impacts from the past year,” said Boeing in a statement. “We have come to an agreement with GECAS to restructure their MAX order book. In light of the COVID-19 pandemic, this adjustment helps to balance supply and demand with market realities, especially in the leasing channel. Additionally, since last year, where it has made sense, we have adjusted our production skyline to the fact that we are building fewer MAX airplanes than planned. Disciplined adjustments provide us with greater flexibility to manage the 4,000 outstanding 737 orders and protect the value of the MAX in the marketplace.”
Although Boeing still has an outstanding order for 82 MAX 737s from GECAS, which currently has 29 within its fleet.
Boeing is due to restart its MAX production line this week, with employees operating on staggered shifts in order to provide as much social distancing as possible.
“As we work to return the 737 MAX to service, our focus remains on addressing our customers’ fleet needs while optimizing the delivery of the more than 4,000 airplanes in our 737 backlog,” Boeing added. “As normal market conditions return, Boeing anticipates that lessors who have restructured or reduced their order books will continue to add MAX aircraft to their portfolios through sale-leaseback agreements with airlines. Longer-term we expect these lessors will again place orders for direct MAX purchases.”
