Allegiant Air 737 MAX Deliveries Delayed

Allegiant Air has announced updates to its agreement with American planemaker Boeing regarding the upcoming delivery of the 737 MAX.

Contract adjustments, such as those taken from the U.S. airline, are becoming increasingly common as Boeing struggles to meet output targets. However, complexities inside its business limit this.

Allegiant Air has amended the initial contract they signed in December 2021, which would have seen them acquire 50 newly manufactured 737 MAX jets from Boeing.

The primary adjustment to the agreement comes in the delivery schedule, which is being forced to change considering Boeing’s challenges, which will not be navigated in time to ensure a smooth delivery can take shape in the coming months and years.

In an SEC filing, the carrier confirmed that between 2024 and 2025, the expected deliveries for the 50 737 MAX jets in the batch will be reduced.

When the American carrier committed to the 737 MAX, it expected that all 50 firm aircraft would be delivered by the end of 2025. However, that is now impossible following colossal delays in acquiring its first unit.

These delays stretched on for quite a prolonged period. On each occasion, the first delivery looked close, and something else would emerge that would mean Allegiant wouldn’t have been able to take delivery of the plane.

As a result, Allegiant Air has stated that it expects all 50 aircraft to be delivered by the end of 2027, permitting no further hiccups. Contracts must be rectified and aligned with Boeing’s ongoing fundamental turnaround efforts.

The airline has also confirmed that the amended agreement will provide other benefits to them long into the future, which is related to the considerable delays it’s facing.

As for the remainder of 2024, Allegiant Air, in the filing, confirmed that it could receive up to three additional aircraft across the fourth quarter of 2024. This forecast is different from what was reported a month ago when it was indicated the airline expected no more deliveries.

Allegiant Air says that future deliveries in the last month of the calendar year and thus quarter are only possible because Boeing rectified strike action with employees, allowing them to get back onto the production floor, building, and thus delivering aircraft to customers.