American Airlines Group Inc. (AAL - Free Report) has yet again extended the grounding of its 737MAX jets. Management stated that the carrier will cancel 115 flights daily through Sep 3.
The carrier had initially notified that 737 MAX jets would be grounded until Apr 24, which was later stretched through Jun 5 and again until Aug 19. Previously, the company expected its current-year pre-tax earnings to be affected to the tune of roughly $350 million. However, the amount of loss might go up with the recent extension in Boeing737 MAX grounding time period.
Additionally, with 24 Boeing 737 MAX jets in its fleet, the carrier needs to make adjustments to its flight schedules to cater to customer needs during the busy summer season.
The worldwide groundings of the 737 MAX aircraft started in March following two successive fatal air crashes in Indonesia and Ethiopia that resulted in the death of 346 passengers.
Meanwhile, Boeing on its part is yet to make a formal submission of its changes and software upgrades to the Federal Aviation Administration (FAA) for an approval.
Other U.S. carriers like United Airlines, the subsidiary of United Continental Holdings (UAL - Free Report) , and Southwest Airlines Co (LUV - Free Report) have extended their Boeing 737 MAX flight cancellations through August.
Zacks Rank & Key Pick
American Airlines carries a Zacks Rank #3 (Hold). A better-ranked stock in the same space is SkyWest, Inc. (SKYW - Free Report) , carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Shares of SkyWest have surged more than 35% so far this year.
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