BUSINESS Southwest pulling Max jet flights until mid-April

Uncertainty rises as to when Boeing jetliner will return to service

WASHINGTON — Southwest Airlines will extend cancellations of Boeing 737 Max flights until mid-April, the company said Tuesday, amid ongoing uncertainty about when the aircraft will be allowed to return to service.

Southwest, which is the nation’s largest 737 Max customer, will be pulling about 300 flights a day from a peak-day schedule in excess of 4,000 flights, the airline said in a news release. Customers who have booked these flights will be notified and reassigned to other planes.

Last week, American Airlines extended its 737 Max cancellations until early April, after the Federal Aviation Administration said it wouldn’t approve the aircraft’s return for the remainder of 2019.

“Taking planes out through April means you’ll miss the spring break hump, which is a peak period of flying,” said David Vernon, a senior analyst with Sanford C. Bernstein.

The 737

Max has been grounded worldwide since March, under scrutiny following two crashes within five months that killed 346 people. Since the grounding, Boeing has continued producing the jets at a cost of $1.5 billion each month, in hopes the FAA would sign off on their return to use.

Boeing is halting production on the 737 Max indefinitely starting in January, a stoppage that could ripple throughout the economy and jeopardize tens of thousands of manufacturing jobs.

A Southwest spokesman said the decision to extend the cancellation was unrelated to Boeing halting production of the Max, as the airline has been evaluating the situation on a rolling 30-day basis.

Last week, Southwest reached a confidential settlement with Boeing for some of the financial losses tied to the 737 Max grounding.

In October, Southwest reported that the aircraft’s grounding had cost the company $435 million through the end of September. The airline has 34 Max jets in its fleet. Gary Kelly, Southwest’s chief executive, said the carrier would share a portion of the settlement — roughly $125 million — with employees through the airline’s profit-sharing plan.

The ramifications are likely to extend beyond the factory floor and across both the aviation and manufacturing sectors. The decision could affect the country’s trade balance.

“This is the country’s biggest single manufactured export product,” said Richard Aboulafia, an aircraft industry analyst at the Teal Group

The suspension of production will likely ripple through about 900 companies in the U.S. and around the world that supply parts for the Max.

For instance, an aircraft parts maker that produces Max fuselages and already has dozens of them in storage is trying to figure out what to do next.

Wichita, Kansas-based Spirit AeroSystems, which is the largest employer in the state’s largest city, said in a statement it was working with customers to determine what Boeing’s announcement means.