American Forecast Cites Billion-Dollar Impact of Max 8 Grounding
American Airlines estimates the grounding of Boeing 737 Max 8 aircraft and rising fuel costs will have an impact of about $1 billion on the company this year. The carrier said the grounding would reduce pre-tax profit by $350 million while higher fuel costs from rising oil prices will add $650 million in spending. These projections forced the airline to lower its forecast for full-year earnings. In just the first three months of this year, idling its Max jets cost the company $80 million in income and resulted in the cancellation of 1,200 flights. American has 24 Max planes in its fleet. American and Dallas-based Southwest Airlines have both removed the Max from flight schedules for the summer travel months. American has had to rebook nearly 700,000 passengers who were supposed to be on the 15,000 Max flights it canceled through Aug. 19.