Well, it’s starting to bubble out in the media that Southwest is close to making an initial order for the 737MAX.  Rumours say it will be a 100 aircraft order.  If negotiations are beginning to finalize, I think it will be for far more aircraft than that.

Southwest currently has 550+ aircraft in its fleet.  Of those, 195 are not Next Generation 737s (-700s).  Those aircraft need to go sooner than later but Southwest only has 133 orders for 737s and of those, 20 are for the -800.  (Southwest also holds 37 options and 98 purchase rights.)

Of the next generation fleet, 370 are -700s and while those seem awfully new, quite a few are getting rather old as well.  Southwest was the launch customer for that aircraft and owns the first one built.  They don’t need replacement in the next 3 to 5 years but they will need replacement in latter part of the decade.

My prediction is an order for 200 and another 200 to 300 options.  I think they’ll choose the CFM Leap56 engine and I think the mix will be weighted towards the 737 MAX 8.   I don’t think the MAX 7 will be ignored but Southwest is growing and it is able to fill the MAX 8 but it will still have a healthy and relatively new fleet of -700 aircraft for its short haul and long/thin routes to use. 

Southwest actually doesn’t generally order “big”.  Typically, they order a few aircraft at a time.  But if they choose the MAX (and they will), there is no reason to not take advantage of Boeing’s desire to get a major airline into the order list.  American Airlines was a hail mary pass and now Boeing needs a credible 737 user to endorse the aircraft.  (Lion Air wasn’t it.)

Filed under: Airline Fleets by ajax