Boeing 737 MAX lands in China, ending import freeze on order backlog

FILE PHOTO: An Ethiopia’s Airlines Boeing 737 Max 8 plane to take off on a demonstration trip to resume flights from the Bole International Airport in Addis Ababa, Ethiopia February 1, 2022. REUTERS/Tiksa Negeri/File Photo

By Lisa Barrington

(Reuters) – The first Boeing 737 MAX jet delivered to a Chinese airline since March 2019 landed in China on Saturday, ending an almost five-year import freeze on the planemaker’s most profitable jets and heralding the potential delivery of a backlog of dozens of finished MAXs to China.

The 737 MAX 8 left Seattle Boeing field in Washington state on Wednesday after being handed over to China Southern Airlines, stopping in Hawaii and the Northern Mariana Islands before its final leg to Guangzhou in southern China, tracking data from FlightRadar24 shows.

China, which was the first country to ground MAX jets after two MAX 8 accidents in 2018 and 2019 that killed nearly 350 people, gave Boeing permission last month to resume deliveries of its 737 MAX 8 to local customers.

While safety bans on the MAX have been lifted, new MAX deliveries had remained on hold since early 2019 as tensions between Washington and Beijing over issues ranging from technology to national security intensified.

China’s green-light is a boost to the U.S. planemaker, which has been hit by the fallout from a mid-air blowout of a cabin panel on a 737 MAX 9 jet operated by Alaska Airlines, including the U.S. Federal Aviation Administration barring Boeing from expanding production of its best-selling narrowbody planes. No Chinese airlines operate MAX 9 aircraft.

Chinese airlines have at least 209 MAX planes on order from Boeing, according to aviation data provider Cirium.

Boeing said in October that 85 of 250 finished MAX planes it had in its inventory were being held for customers in China. More MAX jets were being held for Chinese customers but due to the import freeze Boeing last year remarketed 55 of them to other customers.

The FAA’s unprecedented intervention in production schedules could further delay some deliveries of new planes to airlines and hurt suppliers already reeling from an earlier MAX crisis and the pandemic.

Providing Beijing continues to permit MAX imports, China looks unlikely to be affected by Boeing’s production constraint as dozens of planes for Chinese customers stand ready for delivery.

Chinese airlines are estimated to take delivery of 64 MAX 8 jets in 2024, and 58 in 2025, Cirium data shows.

“Our data indicates that every single one of these expected (2024) deliveries has already flown and is in Boeing’s current production inventory,” said Rob Morris, head of global consultancy at Ascend by Cirium.

“There is potential for a significant number of these aircraft to be delivered,” Morris said.

The MAX handover comes after Boeing in December made its first direct delivery of a 787 Dreamliner to a Chinese customer since 2019.

China is one of the fastest-growing aerospace markets, which Boeing projects will account for 20% of the world’s aircraft demand through 2042.

Boeing declined to comment on the delivery. China Southern and the Civil Aviation Administration of China did not respond to requests to comment.

(Reporting by Lisa Barrington; Editing by Kim Coghill)