737 MAX grounding hits flydubai first half 2019 financial results hard

flydubia ©AirTeamImages

Dubai’s state-owned carrier, flydubai, has announced that the continued grounding of the Boeing 737 MAX has put the carrier under unprecedented financial pressure, resulting in a January-to-June loss of US$53.6 million.

Prior to the grounding, flydubai had anticipated expanding its current fleet of aircraft to 62, but instead this will only grow to 43 this year. flydubai is one of the largest 737 MAX customers with 14 of the currently grounded jets out of an existing order of 250. When the 737 MAX was first grounded, the airline’s chairman indicated that it would turn to Airbus for replacements. However, Chief Executive Ghaith al-Ghaith, issued a statement saying: “We are in ongoing discussions with Boeing, as our long-standing partner, to resolve the unprecedented nature of this grounding and the significant impact it has had on our business and growth strategy.”

Having posted a loss of US$43.6 million last year following a first-half loss of US$86 million, the carrier was optimistic of returning to profitability this year, prior to the 737 MAX debacle. The current six-month loss is a 38% reduction when compared to the first half of 2018, while total revenue remains unchanged from the same six-month period at US$759 million. ASKM was reported at 12,877 million; down 14.9% compared to the period ending 30 June 2018. Passenger numbers dropped to 5 million during the first six months of the reporting period; a decrease of 7.5% as a result of the reduction in capacity.

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