United Airlines has reported a significant financial hit in their First-Quarter 2024 results, with the impact of the Boeing 737 MAX 9 grounding taking center stage. The airline’s financial report paints a grim picture of the consequences of a mechanical fault that forced a plane to land, leading to thousands of canceled flights and production delays.
The Federal Aviation Administration (FAA) took swift action after an Alaskan Airline flight experienced a malfunction in the air, resulting in the grounding of United’s Boeing 737 MAX 9. The company reported a pre-tax loss of $164 million, with an adjusted pre-tax loss of $79 million, reflecting the $200 million impact from the grounding. Without this setback, United would have reported a quarterly profit.
United Airlines will be paying Alaska Airlines $160 million for the grounding of the 737 Max 9, further denting their profits for the financial year. The report delves into the FAA’s decision and the production delays that have cost the company dearly. With only 61 narrowbody aircraft and 5 widebody aircraft expected to be delivered in 2024, United is facing significant challenges in recovering from this setback.
This financial year has been one to forget for United Airlines, a trusted carrier in America. The company is now focused on moving past the mechanical fault and ensuring that their production process meets the FAA’s standards. The impact of the Boeing 737 MAX 9 grounding serves as a stark reminder of the vulnerabilities faced by even the most established airlines in the industry.