Southwest Airlines (WN, Dallas Love Field) has deferred the retirement of seven B737-700s and is scouting the market for second-hand B737NGs to mitigate the effects of the B737 MAX's absence, Chief Executive Gary Kelly said during a recent quarterly earnings call.
"With our -700 retirement schedule, we have a lot of flexibility. So we're actively deferring retirements where it makes sense. Secondly, we're always monitoring the used 737 aircraft market. We'll continue to do that," he said.
Chief Financial Officer Tammy Romo clarified that so far, the LCC has decided to retain seven B737-700s out of the 18 that were originally due to retire in 2019, incurring extra maintenance expenses of USD10 million.
"We'll operate these seven aircraft for around two more years and they are scheduled to be retired by the end of 2021. As for the remaining eleven -700's retirement plan for 2019, we retired six of them; one in the third quarter and five during the fourth quarter. The remaining five retirements have shifted to the first half of 2020," Romo added.
Southwest Airlines expects to retire sixteen -700s in 2020, including the five units shifted from 2019. Originally, the carrier intended to retire between 20 and 25 -700s in 2020.
Kelly admitted that it is unlikely that the B737 MAX will be ungrounded and reintroduced into service by June 6, 2020, the date until which Southwest has so far removed the B737 MAX from its schedule.
"We're assuming that the MAX grounding is short-lived, meaning there are months to go and not years to go," he said.
Southwest Airlines has thirty-four B737-8s stored at Victorville airport. A further 27 aircraft - including B737-7s - are set to deliver immediately after the type's recertification is completed. Chief Operating Officer Mike Van de Ven said that the LCC is prepared to induct between five and ten B737 MAX per week, which would add up to between six and twelve weeks for the induction of all aircraft, including the ones which have not yet been delivered.
The airline is not expecting any further deliveries of B737 MAX other than the 27 units which have already been manufactured.
To accelerate the eventual resumption of B737 MAX operations, Southwest Airlines is investing in simulators. The airline already has three of its own simulators and recently bought a further six. Three of these are due to deliver before summer 2020 with the other three to arrive in the second half of this year.
According to the ch-aviation fleets module, Southwest Airlines currently operates 502 B737-700s and 207 B737-800s.
