Hoping Southwest Airlines and other airlines are going to discount flights to woo travelers when the beleaguered Boeing 737 Max returns?
Don’t count on it – at least not when it comes to Southwest, executives said during the airline’s earnings conference call Thursday.
“At this point, there’s no notion of discounting Max flights,” Southwest President Tom Nealon told reporters. “That’s not in our consideration set at this point.”
Nealon acknowledged that Southwest’s research into whether travelers are willing to fly the Max again is a mixed bag. But he said the “vast majority” of travelers plan to fly it the same as they have in the past and that some travelers said they will fly it more frequently.
“The thought being, it’s actually going to be the safest plane out there with all the scrutiny,” he explained.
Nealon said the general public is “nowhere near as zeroed in on this topic” as those in the airline industry and media.
“I think we’re going to see the customers come back pretty nicely,” he said. “Some may take a little longer than others, maybe a month or two months, but they’re going to come back.”
Airlines aren’t allowed to talk specifics on future pricing, and the plane’s return to commercial service is still months away so travelers could certainly still see flight deals when the planes finally do return to service.
One big reason why: supply and demand. The Max grounding has significantly cut the number of airline seats for sale in an environment with strong travel demand. Southwest alone said the grounding, which began in March 2019, has cost it 6 to 7 million passengers, the airline said on the call, given the thousands of flight cuts due to the plane shortage.
Southwest, American and United, the three U.S. airlines who had the plane in their fleets when it was grounded, desperately want to get those planes – and others that were supposed to be delivered last year – back in the air as soon as possible after the FAA lifts the grounding and pilot training is completed. Southwest said that process will take at least a few months.
Southwest had 34 Maxes in its fleet at the grounding – more than any carrier – and has another 27 that were built and supposed to be delivered last year, sitting in storage at Boeing.
“We want to get (those) 61 aircraft into service as fast as we can,” Southwest CEO Gary Kelly said.
That means a big influx of flights and more choices for travelers, a scenario that usually puts pressure on fares.
Southwest’s flight schedule currently has the plane returning in early June but that timetable will likely be pushed into late summer or fall given Boeing’s revised timetable, issued earlier this week, for the expected ungrounding.
Meanwhile, United said Wednesday the Max will likely be out of service for the second summer in a row. The following day, American Airlines CEO Doug Parker said his airline likely won’t fly the plane until late summer or early fall.
Kelly also reiterated his stance that he sees no need for renaming the Max. Boeing’s new CEO on Wednesday said there are no plans to rename the plane.
“To me, it’s just a matter of being transparent,” he said. “I think the awareness of the Max issue is very, very high. Everybody knows the name 737 Max. Who’s kidding who?”