Boeing 737 Max groundings to hurt Asian airline industry more in second quarter: Fitch Ratings

Boeing’s top-selling aircraft has been grounded worldwide since the 10 March Ethiopian Airlines disaster, which killed 157 people

Press Trust of India April 05, 2019 11:44:35 IST
Boeing 737 Max groundings to hurt Asian airline industry more in second quarter: Fitch Ratings
  • The grounding of the model has had a limited impact on the fares and performances of airlines in most markets

  • Fitch Ratings added that there is limited flexibility for airlines to switch to alternatives from Airbus or Boeing

  • The Indian aviation market has seen a sharp rise in airfares in the recent months due to tight supply

Fitch Ratings said on Friday the impact on the airline industry in Asia from the grounding of Boeing 737 Max jets has been muted so far but may worsen in the second quarter of 2019.

Boeing’s top-selling aircraft has been grounded worldwide since the 10 March Ethiopian Airlines disaster, which killed 157 people, and came just five months after a Lion Air crash in Indonesia that killed 189.

Boeing 737 Max groundings to hurt Asian airline industry more in second quarter Fitch Ratings

Representational image. Reuters

The grounding of the model has had a limited impact on the fares and performances of airlines in most markets due to seasonally low demand in the first quarter, Fitch said in its report.

It added that there is limited flexibility for airlines to switch to alternatives from Airbus or Boeing.

The Indian aviation market, however, has seen a sharp rise in airfares in the recent months due to tight supply, partly worsened by the suspension of the 737 MAX, Fitch said.

A preliminary report in the Ethiopian crash on Thursday showed that the doomed 737 MAX jet hit excessive speed and was forced downwards by a wrongly-triggered automation system as pilots wrestled to regain control.

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