“The Max Brand Is Damaged”: Key Boeing Client Joins Trump In Demanding Renaming Of 737 Max

Back in December, we tweeted “Boeing 737 MAX renamed to Boeing 420; flight certificate secured,” while “Boeing 420” might not be the new name — there are new calls from a major aircraft leasing company for Boeing to drop the name “MAX.” 

President Trump first suggested Boeing rebrand MAX after a faulty flight control system led to two deadly crashes, killing 346 people. The planes have been grounded since March 2019. 

What do I know about branding, maybe nothing (but I did become President!), but if I were Boeing, I would FIX the Boeing 737 MAX, add some additional great features, & REBRAND the plane with a new name.
No product has suffered like this one. But again, what the hell do I know?

— Donald J. Trump (@realDonaldTrump) April 15, 2019

On Monday, Air Lease demanded Boeing drop the “damaged” label of its MAX brand to avoid undermining the value of its 150 MAX jets, reported Reuters. 

“We’ve asked Boeing to get rid of that word MAX. I think that word MAX should go down in the history books as a bad name for an aircraft,” Steven Udvar-Hazy told the Airline Economics aviation finance conference in Dublin. “The MAX brand is damaged, and there is really no reason for it.”

Hazy warned even with a name change – it’s not clear if customers would forget about the two fatal crashes.

The name “MAX” has been tarnished with the blood of 346 lives. Press from around the world covered the disaster and any updates via Boeing’s progress in attempting to unground the planes. MAX could develop the same negative vibes as the name “Hindenburg.” Even after 80 years, Hindenburg is widely recognized as an air disaster that killed lots of people. There’s also a technical indicator called the “Hindenburg Omen” – designed to spot stock market tops. 

With the MAX brand severely damaged, a recent report via BofA Defense Outlook and Commercial Aerospace noted that there are increasing concerns about whether the MAX will return to service. 

BofA anticipates the MAX could return to service by May 2020, but notes “the path to normalization for the 737 MAX may take longer than expected.” 

“For the production rate to ramp-up back to 52 per month, Boeing will still need to get the 387 737 MAX grounded aircraft that were already delivered to airlines to get back in the air and “depickle” and deliver the ~400 undelivered, parked 737 MAX aircraft. Additionally, Boeing will need to synchronize its entire supply chain back to harmony. Getting back to 57 per month may be unlikely.” 

BofA notes, “the key bottlenecks for aircraft delivery” has been Boeing’s ability to issue airworthiness certificates has been stripped and is now up to the Federal Aviation Administration (FAA). This could further delay the jets returning to the skies. 

“Before the 737 MAX grounding, Boeing had expected to ramp up to 57 per month by 2H19. Boeing ability to issue airworthiness certificates and export certificates of airworthiness One of the key bottlenecks for aircraft delivery is that Boeing is no longer allowed to issue airworthiness certificates and export certificates of airworthiness for 737 MAX aircraft. The Federal Aviation Administration (FAA) will be the sole issuer of these certificates.”

Boeing peaked at 69 MAX deliveries in December 2018. Boeing delivered 580 737 aircraft in 2018, which averages about 48 aircraft per month. Before the grounding and now production halt, Boeing delivered 34 737s in January 2019, 32 in February 2019, and 23 in March 2019.

 

And with the production of the MAX halted and no clear timetable of when the planes could return to the skies – the peak commercial jet bubble has started to unravel. This will could trigger a deepening of the U.S. manufacturing recession in 1H20. 

As for the branding, President Trump was right, Boeing must drop MAX and rebrand the troubled planes.