OAG estimates significant capacity reduction from 737 MAX grounding, estimates cost at USD4bn

    OAG, via its official blog, stated (06-Aug-2019) a comparison of the original planned capacity for selected operators in Feb-2019 compared to the current planned 737 MAX operation as at Aug-2019 reveals an overall reduction in capacity of 41 million seats for the included carriers. OAG noted much of the capacity reduction would be assumed in the original planning of the carriers to the financial year. OAG said China Southern Airlines are the largest carrier impacted with a loss of 3.8 million seats whilst American Airlines lost close to two million seats. OAG added: “Using a notional USD100 for the combined impact of additional costs; both direct and indirect and the loss of revenue then for the airlines affected the impact of the lost capacity could be running towards USD4 billion and that assumes a Nov-2019 reintroduction which looks increasingly unlikely”.