American Airlines to buy more 737 MAX jets, defers Dreamliner delivery

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FILE PHOTO: A Boeing 737 MAX 8 sits outside the hangar during a media tour of the Boeing 737 MAX at the Boeing plant in Renton, Washington

-American Airlines Group Inc said on Wednesday it has agreed to buy an additional 23 737 MAX 8 aircraft from Boeing Co by exercising existing purchase options and deferring the delivery of some 787-9 Dreamliner aircraft.

The airline’s move to boost its 737 MAX fleet comes at a time when domestic travel in the United States is staging a recovery, despite the disruption caused by the Omicron variant of the coronavirus.

American Airlines said in a filing that it intends to convert seven more of its purchase options for the MAX this year, bringing its order of the 737 MAX 8 aircraft to 30.

The company has deferred the delivery of Boeing’s long-haul 787-9 Dreamliner aircraft that was scheduled to be handed over in January next year.

Deliveries of aircraft will now begin in the fourth quarter of 2023 and will continue into 2027, with four 787-9 aircraft now scheduled for delivery in 2023, American said.

Delays in deliveries of the 787 jet has already forced the Texas-based carrier to scrap, reduce or defer the introduction of flights to several international routes.

Boeing, which is already paying penalties to American Airlines for pushing back deliveries, said last week it had incurred $4.5 billion charges in the fourth quarter on its 787 program that is suffering from production defects.

The company said in a statement it will continue to work with American Airlines to support its fleet requirements.

The airline has bumped its capital expenditure forecast this year to about $2.67 billion from $2.63 billion projected earlier to account for the aircraft additions.

It also expects a capital spend of $2.86 billion next year, up from its prior estimate of $2.71 billion.

Shares of American Airlines fell 1% in afternoon trade, while Boeing was down 2%.

(Reporting by Abhijith Ganapavaram and Nathan Gomes in Bengaluru; Editing by Shounak Dasgupta, Aditya Soni and Uttaresh.V)