American Airlines expects a negative impact of $185 million to its second quarter pre-tax income from cancellation of Boeing 737 Max flights.
The Oneworld carrier scrapped 7,800 flights in the second quarter and has removed all 737 Max-operated flights from its schedule through 3 September.
It expects to provide an update on the full-year impact from the cancellations in its second quarter earnings call, expected to take place later this month.
American had operated a fleet of 24 737 Max aircraft before US regulators grounded the aircraft on 13 March. It is not clear when the aircraft will be cleared to return to the skies.
The 737 Max cancellations are only one part of an operationally challenging second quarter for the Fort Worth-based carrier, which in May sued two mechanics’ unions in an effort to halt an alleged work slowdown the airline said delayed or forced cancellation of more than 1,000 flights. A temporary restraining order to end the slowdown was granted by a federal court in June.
«That slowdown has significantly impacted the company’s operation and caused a significant number of flight cancellations and delays in the second quarter,» says American in an investors update.
As a result of the flight cancellations, the carrier operated 72.3 billion available seat miles in the second quarter, or 1.1 billion fewer than previously guided.
Unit revenue is expected to grow 3-4% in the second quarter, exceeding previous guidance of 1-3%. American attributes the performance to greater-than-expected load factors, although cargo revenue has been less than expected due to weaker demand in Asia and Europe.
Unit cost excluding fuel and special items is now forecasted to grow 4.5% to 5.5%. American had earlier guided for the metric to increase 3.5% to 5.5%…