Southwest just ordered over 100 Boeing 737 MAX 7s, the smaller variant of the MAX which isn’t yet certified. American Airlines is looking at a big order for these planes as well, though it is not likely to come right away.
In July I was first to report that American is considering a narrowbody order. CEO Robert Isom told employees in July, “We’re going to need aircraft, and I wouldn’t be surprised if at some point we make a commitment to some narrowbody aircraft as we get past 2027.”
Now there’s confirmation from internal leaks that American is indeed looking at a narrowbody order and of the specific aircraft under consideration. The airline needs a plan to replace their oldest Airbus A319s and A320s, as well as their oldest Boeing 737-800s.
AA: some upcoming narrowbody order musings:
-319 replacement. The 319neo isn't really an option because Airbus charges the same as a 321neo since it takes the same space on the production line.
-They're comparing it to the MAX7, 220, and E2 195
These are musings.— JonNYC (@xJonNYC) October 26, 2023
American is considering:
- Boeing 737 MAX 7
- Airbus A22-
- Embraer E195 E2
American Airlines Boeing 737 MAX Interior
The Boeing 737 MAX 7 seems like the obvious choice, though I wouldn’t be surprised to see a mixed order of some kind. Boeing will be very motivated to move this aircraft, given their broader struggles and that this program hasn’t been certified yet. It also wouldn’t complicate their fleet as much as alternatives.
It ls likely too expensive and availability too scarce to acquire more Airbus A320 family aircraft. The backlog there is great with strong overall demand, though American did tell employees over the summer that they are not concerned with the backed up order books of the major planemakers.
With all of the orders that other airlines have placed, there’s much discussion that there’s just no room in delivery schedules at this point for airlines to buy more planes and that when an airline like United has placed massive orders of both narrowbody and widebody planes they’ve also blocked other carriers from acquiring new jets.
But American’s position is that they’ll make room for their orders because they’re the world’s largest airline and in a position to take delivery and pay for the planes unlike some new smaller players.
An order for Boeing MAX 7 and MAX 8 (or MAX 10!) planes likely offers the best price, delivery slots, and fleet commonality along with good operating costs. I would be very surprised to see them order E2s or 220s, but of course they will shop ’em and use them as a stalking horse in negotiations.
For years American has promoted that they had ‘already renewed their fleet’ and thus will have low capital costs for years. However they’re taking new aircraft over the next several years, such as Airbus A321XLRs and Boeing 787s. And they do appear to be looking at another major order, likely to increase the debt perhaps back to levels they’re trying to pay down from coming out of the pandemic.
nobody’s crying.
UAL is chasing summer international travel but their YTD earnings or margins are nowhere close.
There is no financial justification for spending $35 billion more than your competitors to win in margins for a quarter or two at best and then by only a percentage of two while underperforming for the entire year.
Your Majesty Hanger Queen Tim Dunn,
That’s a lot of words to back without any data to prove it. But what do the numbers actually say?
Q1 2017 – Q4 2020
Revenue
DL 150.26B
UA 137.65B
Net profit/loss
DL 87.65M loss
UA 223.96M profit
Q1 2020 – Q3 2023
Revenue
DL 141.401B
UA 125.035B
Net Loss
DL 8.299B (-6%)
UA 6.278B (-5%)
Q3 2022
Net Income
DL 759M (5.4%)
UA 942M (7.3%)
Revenue
DL 13.99B
UA 12.88B
H2 2022
Revenue
DL 27.45B
UA 25.28B.
Net Income
DL 1.69B (6.1%)
UA 1.79B (7.1%)
Q3 2022 – Q1 2023
Revenue
DL 40.24B
UA 36.71B
Net Income
DL 1.41B (3.5%)
UA 1.59B (4.2%)
Q3 2023
Revenue
DL 15.488B
UA 14.484B
Net Income
DL 1.108B (7%)
UA 1.137B (8%)
It’s a wonder how competitors spend so much more than Delta but are unsurprisingly more profitable and have higher margins. Perhaps DL needs to bring on Scott Kirby to steer the ship back on course.
When the data doesn’t lie, Tim always cries!
All hail the hanger queen, Tim Dunn!
Year to date, United is underperforming Delta in total profits.
UAL has the oldest fleet, most inconsistency in its premium product, took a one-size-fits-all strategy w/ Polaris, and is spending 3X more on fleet than any other airline.
UA is an also ran company led by ego-driven flunkies from American which is turning itself around after years of mismanagement by the same flunkies that are now leading United.
Dear Your Majesty Hanger Queen Tim Dunn,
For 2023, United was more profitable than DL not only in the MRQ, but also in the off peak 1Q. So thank you again for admitting that Delta was less profitable than United so far in 2023. Also shout out to American for also being more profitable than Delta also in Q1 2023.
Q1 2023
Net Income
AA 85M
DL -273M
UA -194M
What did Tim Dunn say before the 2023 Q3 earnings release?
“United does NOT make near as much money in the same regions as Delta and that is why United’s profits on a system basis on an apples to apples basis were lower in the 2nd quarter and will be in the 3rd quarter.
Delta announced their profits today and spoke very favorably about their international regions.
The ball is now in UA’s court. If their international regions are as strong as they and you talk, they should outperform Delta when they report but you and I both know that won’t happen.”
What happened?
Q3 2023
Revenue
DL 15.488B
UA 14.484B
Net Income
DL 1.108B (7%)
UA 1.137B (8%)
It’s hilarious how confidently wrong you always are with your predictions. A literal walking clown show with a frail ego, overly butthurt and psychologically divergent when proven wrong… again.
When the numbers don’t lie, Tim always cries!
All hail the hanger queen, Tim Dunn! All hail the prediction blunder champion!
I’m starting to wonder if there is something mentally wrong with Tim D? Even after a major travel blog writer writes an article about Tim’s constantly defending Delta to a unrealistic degree, he still finds it necessary to respond to everyone who questions what he states in his various comments and responses to various airline related articles. A psychiatrist really needs to evaluate Tim’s fetish with Delta Airlines.
I am also surprised that he has such a fetish since I read this week that Tim did not retire from Delta Airlines like I originally thought, but that he was fired. If he was fired from Delta, you would think he would hate Delta Airlines? Not unless his defending Delta Airlines in recent times is his way of “kissing up” to Delta management to get his old job back? One just wonders what is going on in his head?
major blog writer writing about me? You are smoking stuff late at night.
It’s not about anything but defending the truth.
United is underperforming DAL THIS YEAR. In as close to the same business conditions as could be had.
Except United hasn’t settled w/ its flight attendants while Delta has raised the pay of all of its employees.
the only people that are mentally unstable are the people that are hellbent on manipulating every fact they can think of to avoid admitting that reality.
Tim,
I cannot believe you did not see this article. I always thought you were on top of everything? I guess your not as smart as I thought you were. I’m not smoking any thing. Here is the link to the article about you:
https://liveandletsfly.com/united-airlines-vulnerable/
Tim,
I’m not smoking any thing. I thought you kept yourself on top of things. Here is the article about your constant comments:
https://liveandletsfly.com/united-airlines-vulnerable/
thanks for showing me.
I don’t even read that site.
D
You do know that Seeking Alpha has comments and he didn’t offer any response under his own name?
And more notably, he didn’t address the reasons WHY I said United was the industry’s most vulnerable – its capex which is 3X larger than any other US airline ( happens to be Delta) and its hyperfocus on chasing international revenue which is still in the “revenge travel” mode”
I’m glad he provided a little more coverage but he clearly is not capable or at least is unwilling in address business issues which I raised.
None of which changes that United has financially underperformed Delta for years, is doing so in 2023, and it is pathological for some to bend every which way to avoid having to admit that.
Oh, and Delta is the most profitable, highest market cap, highest revenue airline in the world. There is a reason why it gets as much attention as it does.
and it is worth noting that UAL stock is down 18% from when the article was written.
Seeking Alpha is an investment site.
My “sell” rating was an accurate prediction of the movement of the stock.
Your Majesty the Hanger Queen Tim Dunn,
“and it is worth noting that UAL stock is down 18% from when the article was written.
Seeking Alpha is an investment site.
My “sell” rating was an accurate prediction of the movement of the stock.”
Prime example of the walking clown show that is Tim Dunn, the whole airline industry went down and yet you completely missed the 3 airlines who were impacted the most due to the ongoing P&W GTF issues despite calling UAL the most vulnerable.
099/24/23-10/31/23
DAL -15%
UAL -17%
AAL -11%
LUV -16%
ALK -13%
JBLU -5%
ALGT -9%
SAVE -20%
ULCC -22%
HA -32%
Then on 10/24/23 you gave a STRONG BUY for DAL.
10/24/23-10/31/23
DAL -2%
UAL -1%
AAL 0%
LUV -6%
HA 1%
ALK 0%
JBLU -3%
SAVE -22%
ULCC -6%
ALGT -4%
In fact, Spirit recently reported that P&W is suspecting similar issues on A320neos that haven’t been delivered so there’s a good chance DL will be similarly impacted as they’re more exposed vs. AA/UA/WN who have almost no existing aircraft that’d be impacted.
Puts on Tim Dunn would be an infinite money machine.
When the data doesn’t lie, Tim always cries. All hail the prediction blunder champion. All hail, the hanger queen Tim Dunn!
I give you kudos for the tenacity you have shown in arguing here but you and the comments above yours highlight a number of principles that I have seen in over 15 years of participation in airline social media
1. Airlines have plenty of very loyal people that irrationally support “their team” and lash out strongly against anyone that criticizes their brand (often also their employer) as if one was defaming someone’s mother.
2. When people don’t like facts, they just ignore them, cherrypick whatever data they do use and argue for a standard that is unlike what they want.
The simple fact is that UAL has underperformed DAL in 2023 YTD and every post you have made doesn’t change that.
DOT profitability by geographic region data comes directly from the airlines themselves and the total profit still has to sum to the same number reported on their system profit numbers, meaning that if someone wants to raise the profit reported in one region, they have to take it out of some other region. Feel free to let us know what regions were less profitable during the normal years (2017-2019) when UAL reported losses flying the Pacific.
3. when people can’t win on facts, they attack people personally and try to eliminate them from the discussion.
specific to your last post, my “sell” rating on UAL came w/o a time frame which means it is accurate from the day the article was published.
My “strong buy” recommendation came w/ timelines. You fail to note them but they are not “in period”
DAL has specifically said they have asked Pratt and Whitney for guidance on exposure to the GTF but they have not been provided anything – or have not reported it. Since DAL’s A321/320 family NEO fleet is much younger than other airlines including JBLU and SAVE, it is very possible that DAL has little to no effect.
Aircraft engines is not one of the reasons I stated UAL is vulnerable. My assessment of UAL’s vulnerability is because of its much higher capex compared to every other carrier while not generating cash sufficiently higher to cover that capex. There is no reason to think that UAL won’t end up in the same situation that AAL got itself into.
and UAL is hyperfocused on chasing every bit of revenue in the shortest period of time which is why their financials are not comparable to DAL on a YTD basis for 2023. I do not believe that UAL’s strategies reflect long-term reality but rather a fixation that what is happening now will be reflective of the future – which I think is inaccurate.
I find it most laughable that my work written elsewhere gets discussed elsewhere when Seeking Alpha provides a comment mechanism on its site.