United ‘Working on Alternative Plans’ Without Boeing Max 10, CEO Says

Boeing’s biggest customer is considering “alternative plans” for its future fleet. 

The comments came from United Airlines CEO Scott Kirby, who expressed frustration about the new 737 Max 10 and the smaller Max 9.

“There’s great mechanics, great engineers, a great storied history, but they’ve been having these consistent manufacturing challenges and they need to take action together,” Kirby said on CNBC’s “Squawk Box” on Tuesday morning.

The CEO revealed that United is considering a plan that does not include the Max 10 in its fleet. The plane is the largest variant in the 737 Max family and has not yet been certified by the Federal Aviation Administration. 

United currently has 235 Max 10s on order, according to data from Cirium Diio.

That model and the Max 7 — the smallest of the family — are years behind schedule for FAA certification. The ongoing Max 9 grounding could add more complications to the Max 7 and Max 10 certification process. 

United’s Five-Year Delay

Kirby said the carrier is at least five years behind on its original Max 10 delivery. 

“We’ve already started working on alternative plans,” the United CEO said. “I think this is the straw, the Max 9 groundings, probably the straw that broke the camel’s back for us. We’re gonna at least build a plan that doesn’t have the Max 10 in it.”

Kirby’s comments come as the carrier is holding an earnings call on Tuesday at 10:30 a.m. ET. United said in a filing on Monday that it is expecting a bigger first-quarter loss due to the grounding of the Max 9.

The FAA grounded the Max 9 after a door plug blew off an Alaska Airlines flight mid-air. United operates 79 Max 9s, the most of any U.S. carrier, and the grounding has caused the firm to cancel hundreds of flights daily for the last three weeks. 

Fresh Challenges for Boeing

Boeing has garnered more scrutiny for the incident as it’s not the first time the manufacturer has faced issues with the 737 Max. After two fatal crashes involving the Max 8, the FAA grounded the jet for nearly two years. On Monday, the FAA asked airlines to visually inspect door plugs on the 737-900ER, an older model, because it had identical door plugs to that of the Max 9. 

When asked about weighing a potential order for Airbus jets instead, Kirby did not rule it out. The United CEO said he hoped Boeing would be able to overcome its quality and production issues. 

“I’ll wait and see,” Kirby said. “I mean, obviously there’s only one other manufacturer that’s really an option for us but we’ll wait and see.”