The airline industry has a tendency to overexpand in good times, and with signs of an economic downturn ahead, some carriers may seek to use the 737 MAX crashes as cover to trim their fleet growth plans
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The airline industry is prone to overexpand in good times, and as the aviation journalist John Ostrower, signs of a downturn are mounting. Some other carriers may seek to use the safety concerns over the MAX as cover to trim orders, but analysts expect the damage for Boeing to be limited. Its domestic competitor Lion Group, one of Boeing’s largest customers, has threatened to cancel its order for 187 of the Chicago-based plane maker’s bestselling jet in the wake of the crash October 29 of a Lion Air 737 MAX 8 that killed 189.
“I think that there is a near certainty that some orders are going to quietly get ‘re-discussed,’ with customers claiming that they should now get discounts due to the splatter on the MAX reputation,” says Boyd.
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