Southwest Airlines Boeing 737AP

  • Boeing’s 737 Max aircraft on Sunday was involved in its second disaster in just five months.
  • Southwest Airlines has the highest exposure of all US carriers to the aircraft.
  • Southwest shares fell more than 1% Wednesday after President Donald Trump announced all 737 Max planes would be grounded in the US.
  • Watch Southwest Airlines trade live.

Southwest Airlines was down over 1% Wednesday after President Donald Trump announced Boeing’s 737 Max planes would be grounded in the US following its second accident in five months. Southwest is the US airline with the largest exposure to the 737 Max aircraft.

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Nearly 10% of Southwest’s available seat miles will come from the 737 Max in October 2019 according to research provided by Stifel Financial. Southwest added 18 737 Max aircraft to its fleet last year. 

Boeing 737 Max exposure by ASMStifel, Diio

“We’re very proud to have an all-Boeing 737 fleet with significant modernization opportunities with the MAX going forward,” Southwest CEO Gary Kelly said at the JPMorgan Aviation conference earlier this month. “The real opportunity is more along the fleet modernization side, which clearly means let’s bring in the MAX and retire NG’s respectively.” He noted that the MAX is 14% more fuel efficient and 40% quieter than predecessor aircraft. 

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Boeing stock fell by more than 10% on Monday and Tuesday amid concerns about the safety of the company’s 737 Max aircraft program. Air carriers and countries around the world grounded the aircraft in the wake of Sunday’s crash. 

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Southwest reported fourth-quarter earnings of $1.17 per share, or $654 million, as revenue jumped 8.2% year-over-year to $5.7 billion. The company’s stock was up 8.4% this year through Tuesday.

Southwest stock chartBusiness Insider



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