A deal that could involve at least 150 planes and shake up the commercial jet market is about to be decided soon, Bloomberg said on Wednesday. And the winner of a long competition for the order from Southwest Airlines is expected to be Boeing, according to sources familiar with the matter.
The US low cost airline, the largest operator of the 737 in the world, is expected to announce a massive order for the MAX 7 variant, the smallest in the family, in order to replace old 737-700 currently in use.
According to Bloomberg, the agreement should involve the delivery of 150 to 200 jets, which means less than half of the 737-700 present in Southwest – 473 airplanes with an average age of 16.6 years, according to Planespotters.
If the order is confirmed, it will be a serious blow to Airbus, which hoped to break Boeing’s monopoly over Southwest, a loyal 737 customer for many years, with which it has reduced its operating and crew training costs.
In fact, the Dallas-based airline has always been reluctant to adopt a second aircraft, on top of another manufacturer, but the problems with the 737 MAX and the new reality of air travel, where smaller planes seem more suited to demand, would have made Southwest rethink its strategy.
More efficient
To make the decision even more complicated, the A220-300, an aircraft whose Southwest CEO Gary Kelly has admitted analyzing since 2019, is a much more efficient product than the 737 MAX 7, a model that has collected few orders so far.
Although the MAX 7 carries more passengers (150) and has a longer range, it is a heavier aircraft and only becomes attractive on medium-range routes. With 145 seats, the A220 has a lower operating cost per seat and its autonomy is suitable for most of the air network where today the 737-700 is used.
For these reasons, it was thought that Southwest could finally break with the Boeing tradition, further reinforced by the fact that the new aircraft will be the base of the fleet. With the Airbus jet, the carrier could start implementing a new standardization of equipment and, who knows, even opt for the A320 family on routes with a higher volume of passengers.
For all its symbolism, losing Southwest as one of its main customers would be extremely serious for Boeing. To convince the US airline to stay with the 737 MAX, the manufacturer must certainly offer a good discount and advantageous conditions that make up for part of what Airbus could put on the table.
After all, moving to a new aircraft and a new manufacturer in a company that operates thousands of flights in the USA is not a pleasant task, much less a cheap one.
The irony of the dispute is that the A220 has once again become a stumbling block for Boeing. When it was still the Bombardier C Series, the new twinjet defeated the MAX 7 in a deal with Delta Air Lines, sparking unjustified protests from the US planemaker.
This time, Boeing looks like it will win the round, but certainly at a high cost.
