Boeing 737 Max model, involved in last week’s Air Alaska incident, is in direct competition with Airbus’ A320

Airbus 320

Banco Sabadell : The FAA (Federal Aviation Administration) decided to order a flight ban on the 737 Max model 9 (the longest-range variant of the single-aisle models) following the Alaska Air incident on the night of 5 January last. Specifically, the incident was caused by the loss of part of the fuselage during flight -its plugged exit door exited the airframe shortly after departure from Portland International Airport- which resulted in a rapid decompression inside the aircraft.

The ban affects 171 aircraft, mostly located in the USA. The 737 Max is in direct competition with the Airbus A320, where the European manufacturer has consolidated a market share of about 60% in recent years.

Assessment: For Safran, which is the sole supplier of the 737 Max engines, the news is negative insofar as this incident could delay the production ramp-up of the engines. For Airbus, which is a direct competitor, the news would have a positive bias, although a significant impact is not expected as the focus is currently on the evolution of aircraft deliveries and the continuity in the sequential improvement of the supply chain situation.

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