Aviation Industry Updates: November 24, 2020

The 737 MAX Is Back | Just What Passenger Confidence Needs

KEY POINTS:

• Twenty months after it was first grounded following two fatal accidents, the US Federal Aviation Administration (FAA) has cleared the way for the airplane to fly again.

• For the airlines that will operate the MAX, this creates a complex problem. How will they handle it when a traveler is afraid to get on board?

• At the time of the grounding, American, Southwest, and United were the only US-based operators flying the MAX with a total of 72 aircraft in their fleets, according to Cirium data. Those were promptly sent to long-term storage and further deliveries were suspended.

• ...the belief that the MAX was unsafe became pervasive in travelers' minds.
  The MAX has now been so thoroughly reviewed by regulators and reworked by Boeing that it should be considered incredibly safe.

• Earlier this year, Boeing CEO Dave Calhoun seemed inclined not to make changes. "My instincts are that a change, just a straight-out change with a new name would be sort of silly," he said. "Our opportunity is simply to restore the faith and trust in the 737 family."

• Airlines also seem to be embracing the idea that cutting the connection with the past is a bad idea for building customer confidence. All of the US-based operators have made it clear they'll ensure the customer knows they will be flying on a MAX for the sake of transparency.

• If a traveler doesn't want to fly the airplane, a spokesperson for the airline succinctly explained the airline's strategy, "In short: transparency and flexibility."

• American says it will have an "enhanced notification process" to tell travelers they've been moved to a MAX. Travelers will then be able to switch to a different flight or, if no other option is available, change their destination to anywhere within 300 miles of the original destination. Travelers can always cancel the flight and put it into a credit for future travel as well.

• United also confirmed that travelers who do not want to fly on a MAX will either be rebooked at no cost or will be eligible to have their tickets refunded.

• Southwest was the largest operator before the grounding with 34 MAX aircraft in the fleet. It is taking a slower approach with no return to service until the second quarter of 2021. In the meantime, it has created an online 737 MAX Resource Center for customers.

• When the MAX does return to service and travelers see the aircraft flying safely day after day, the hope is that the fear will fade and most people can go back to forgetting about what aircraft they're flying on, just as it used to be.
  Until that happens, however, travelers will have plenty of options to avoid the airplane.

CNN
FAA Return to Service

Southern Air 777 Stalls On Departure...Loses 300 Feet | Live ATC Recording

International COVID-Free Flights Now In Operation | How Are Passengers Reacting?

KEY POINTS:

• The first proven Covid-19-free flight will touch down at London Heathrow from New York’s Newark airport. It’s the first plane to arrive in a month-long trial that is hoped will get the travel bridge between the U.K. and the U.S. up and running again.

• It will be Covid-19-free because all the passengers and crew onboard the United Airlines flight will have been tested for Covid-19, at the airport immediately before they fly, and only travelers with negative results will be allowed to travel.

• According to a company statement, United Airlines said, “from November 16 through December 11, the airline will offer rapid tests to every passenger over 2 years old and crew members on board select flights from Newark Liberty International Airport (EWR) to London Heathrow (LHR), free of charge.

• The economic value of flights between the U.K. and the U.S. shouldn’t be underestimated. A leading aviation industry company calculated that with an expected 85% decrease in flight capacity planned between the U.K. and the U.S. from October onwards, approximately £32 million ($42 million) is wiped off U.K. GDP each day.

• Industry professionals have been pushing for rapid PCR testing at airports to allow passengers to board planes after taking a test upon arrival at the airport, rather than having to quarantine upon arrival for 14 days.

• On 10 November, the U.K. government signaled that it was ready to expand rapid airport testing for Covid-19 across all U.K. airports should the results of several trials prove their effectiveness.

Forbes

Rosy Rebound | Private Air Travel Sees Spikes… What Does This Mean?

KEY POINTS:

• Speaking separately, top executives for the three largest fractional and charter aircraft operators offered a rosy view of the rebound and the likelihood that it has wings.

• Andrew Collins, the CEO in charge of Directional Aviation’s jet card and charter units – Sentient Jet, FXAIR, and PrivateFly – told attendees he recently reinstated his pre-pandemic budgets for the year and is “hitting most of those numbers.”

• Kenny Dichter, the founder and CEO of Wheels Up, told attendees his company would increase members from 6,000 at the end of 2019 to 10,000 by year’s end.

• Speaking about the recovery, he noted, “If you look at the flight action, we’re at pre-COVID levels, and you have only one leg of the demand stool pushing that, and that would be the high net worth travel. We’re really bullish that the traditional vacation flyer and business flyer, which are the other two legs of the stool, are going to come back strong. I think we are going to see unprecedented levels of flying in the domestic profiles.”

• After initially pulling back at the outset of the crisis, NetJets reversed course by July. That enthusiastic outlook is still in full force.

• Patrick Gallagher, president of Berkshire Hathaway’s business aviation unit, said the seller of fractional shares and jet cards would take delivery of 10 new private jets through the end of 2020 and over 30 for the full year. What’s more, he said plans call for at least 40 new aircraft deliveries in 2021 and each year for the next decade. “We think we have a nice long runway of an increase in new business.”

• In terms of activity, he says flying is at about 85% of pre-COVID levels, with expectations that numbers will bounce back to 2019 levels by the middle of next year.

• Rob Scholl, senior vice president of sales for Textron Aviation, said turboprops and smaller private jets are attracting first-time buyers.

• Michael Amalfitano, the CEO of Embraer Executive Jets, said while first-time buyers typically make up just 10% of purchasers, for entry-level jets, it is running as high as 50%.

Forbes

Weekly TSA Numbers | 2x Crossing 1M

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