Malaysia Airlines suspends taking delivery of Boeing 737 MAX jets due to grounding

Malaysia Airlines had been due to take delivery of its first 737 MAX aircraft in July 2020. (Reuters)
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Updated 15 January 2020

Malaysia Airlines suspends taking delivery of Boeing 737 MAX jets due to grounding

  • Malaysia Airlines decision represents another setback for Boeing
  • The carrier had been due to take delivery of its first 737 MAX in July 2020

KUALA LUMPUR/SYDNEY: Malaysia Airlines said on Wednesday it has suspended taking delivery of 25 Boeing 737 MAX jets, citing the plane’s delayed return to service since it was grounded last year following two fatal crashes.
The decision represents another setback for Boeing, which on Tuesday reported its worst annual net orders in decades, along with its lowest number of plane deliveries in 11 years, as the grounding of the 737 MAX saw it fall far behind main competitor Airbus.
“In view of the production stoppage and the delayed return to service of the 737-MAX, Malaysia Airlines has suspended the delivery of its orders,” the airline said in an email.
The carrier had been due to take delivery of its first 737 MAX in July 2020 but last year its chief executive said the introduction to service could slide beyond that.
Malaysia Airlines did not respond immediately to a request for comment on how many of the 25 planes it has on order were due to be delivered this year.
Analysts said cash-strapped carriers like Malaysian Airlines that over-ordered planes could take advantage of the 737 MAX grounding to negotiate with Boeing to restructure their orders.
Virgin Australia Holdings last year said it would delay taking the first deliveries of 737 MAX jets for nearly two years to reduce capital spending.
Norwegian Air Shuttle ASA last year said its Dublin-based leasing subsidiary had reached an agreement with Boeing to postpone delivery of 14 737 MAX planes that were originally due in 2020 and 2021.
Boeing on Tuesday reported a net negative of 183 orders for the 737 MAX in 2019 including cancelations, but many were associated with the collapse of a major customer, India’s Jet Airways.
Boeing did not respond immediately to a request for comment about Malaysia Airlines’ decision to suspend deliveries of its orders.
The Malaysian government has been seeking a buyer for the debt-heavy airline, which is still recovering from two tragedies in 2014, when flight MH370 disappeared in what remains a mystery and flight MH17 was shot down over eastern Ukraine.


Saudi minister: OPEC+ will take responsible approach to virus

Updated 26 February 2020

Saudi minister: OPEC+ will take responsible approach to virus

  • Saudi Arabia supports the further oil production cut, but Russia is yet to announce its final position on the matter

RIYADH: Saudi Arabia’s energy minister said on Tuesday he was confident that OPEC and its partner oil-producing nations, the so-called OPEC+ group, would respond responsibly to the spread of the coronavirus.

He also said Saudi Arabia and Russia would continue to engage regarding oil policy.

“Everything serious requires being attended to,” the minister, Prince Abdul Aziz bin Salman, told reporters at an industry conference in Riyadh.

An OPEC+ committee this month recommended the group deepen its output cuts by an additional 600,000 barrels per day.

Saudi Arabia supports the further oil production cut, but Russia is yet to announce its final position on the matter.

The minister said he was still talking with Moscow and that he was confident of Riyadh’s partnership with the rest of the OPEC+ group.

“We did not run out of ideas, we have not closed our phones. There is always a good way of communicating through conference calls,” he said.

Regarding the coronavirus, which has impacted OPEC member Iran, he said OPEC+ members should not be complacent about the virus but added he was confident every OPEC+ member was a responsible and responsive producer.

The flu-like SARS-CoV-2 virus, which first broke out in China, has now spread to more than 20 countries.

“Of course there is an impact and we are assessing, but we’ll do whatever we can in our next meeting and we’ll address that issue,” UAE Energy Minister Suhail Al-Mazrouei said at the same industry conference.

Saudi Aramco CEO Amin Nasser on Monday said he expected a short-lived impact on oil demand.

“We think this is short term and I am confident that in the second half of the year there is going to be an improvement on the demand side, especially from China,” he said.

Oil climbed on Tuesday as investors sought bargains after crude benchmarks slumped almost 4 percent in the previous session, although concerns about the global spread of the virus capped gains.