SINGAPORE (AP) — Asian airlines are cutting routes, revamping their schedules and leasing extra aircraft to fill the gaps left by groundings of Boeing 737 Max 8s after deadly crashes in Indonesia and Ethiopia killed 346 people.
So far, carriers have managed to avoid major disruptions, but analysts expect that idling the Max 8s, a fuel-efficient update of Boeing’s popular 737, will crimp growth plans in the near future.
As investigations into the crashes continue, Boeing anticipates a $1 billion increase in costs related to the 737 Max, including fixing software implicated in the disasters, adding pilot training and compensating airlines and families of crash victims.
In Asia, where air passenger traffic is growing the fastest, the groundings are pushing airlines’ costs higher at a time of rising fuel prices, squeezing carriers’ profits.