SEATTLE, WASHINGTONBoeing finds new customers for its unclaimed 737 Max jets thanks to the faster-than-expected recovery in domestic air travel after more than a year pandemic period that crippled the airline industry severely.

Some airlines are now buying these jets from canceled order books amid a vaccine-fueled travel rebound in the U.S. and other parts of the world.

A year ago, airlines were parking planes in deserts, and some permanently retired less efficient planes in their fleets as they prepared for an extended downturn. While many business travelers have yet to return and lucrative international routes are still on pause, domestic air travel has been on growth in recent months, U.S. airline executives say.

Flights in the U.S. are 84% full, on average, amid a surge of summer travel. The number of people passing daily through airport security checkpoints has neared 2 million recently — a level last reached in March 2020. While previous travel rebounds have been cut short by new waves of infections and restrictions, airline executives are more confident now that the recovery has begun in earnest and their finances have started to stabilize.

Carriers have responded by adding flights, making plans to bring back idled crew, and hiring new pilots and flight attendants. They are also starting to expand their fleets.

Major U.S. carriers such as United Airlines and Alaska Airlines are among recent buyers of the unclaimed MAX planes. The jets are often referred to as whitetails, an industry term for those that aren’t painted in airline colors. The MAX jets in question need to be repainted with their new owners’ liveries.

United said the carrier’s earlier order for 25 MAX jets, announced in March, includes planes from Boeing’s built inventory as well as planes to be produced later. An Alaska Airlines spokeswoman said nine MAX jets it secured in a December deal had been built for other carriers.

Separately, United has been in talks with Boeing about a potential order for as many as 150 additional jets.

Another US carrier Southwest Airlines said this week that by August, it will be flying roughly as much as it did in the same month in 2019. The airline has added 18 new destinations over the course of the pandemic, including the Thursday announcement of flights to Syracuse, N.Y., this fall.

On Tuesday, Southwest said it would increase its order for a new, smaller version of Boeing’s 737 MAX by 34 planes next year, accelerating plans it unveiled in March to refresh its all-Boeing fleet.

The number of Boeing’s unclaimed MAX aircraft is fluid as airlines in the U.S. and a few other parts of the world increase flying and add to their fleets. Customers typically pay the bulk of a plane’s purchase price at delivery.

Some Boeing customers are likely to face supply constraints this summer, CEO David Calhoun said earlier this month. He called the recovery “more robust than I ever imagined.”

Boeing’s push to stop bleeding cash depends heavily on delivering more MAX jets, having delivered about 100 to airlines since December. It had about 400 MAX jets in its overall inventory at the end of March, according to a securities filing. Most delivered jets have gone to U.S. airlines and lining up additional customers for unclaimed planes will help it reach the goal of generating cash next year.

A Boeing spokeswoman said the plane maker was grateful for its customers’ continued confidence in the 737 MAX.

Boeing’s ability to find homes for the MAX jets also highlights the airline industry’s two-speed recovery. High vaccination rates in the U.S. and China helped domestic traffic recover to pre-pandemic levels. The two countries account for two-thirds of the global traffic rebound from last year, according to the International Air Transport Association, a trade group. Airlines in Europe and most of Asia, meanwhile, are struggling to find passengers.
(Via Wall Street Journal)