Southwest sees $150M revenue hit from grounded Boeing 737s
- The grounding of Boeing's 737 Max 8 is weighing on Southwest's financial performance
- The airline now says that it will contribute to $150 million in lost revenue for the first quarter
- The company also said "unscheduled maintenance disruptions" are taking a bite from its revenue
Southwest Airlines lowered its revenue forecast on Wednesday, saying it expects to cancel 9,400 flights through the end of March, partly due to the grounding of its Boeing 737 Max 8 airplanes. The carrier said it expects $150 million in lost revenue from the grounding, winter weather disruptions and other causes.
In a regulatory filing, the airlines said its "available seat miles," an airline industry metric that measures capacity, in the first quarter will increase 1 percent, down from a previous forecast of 3.5 percent to 4 percent growth.
The Federal Aviation Administration grounded all 737 Max 8 aircraft earlier this month following the deadly Ethiopian Airlines crash that killed 157 people, including eight Americans. Southwest, which owns 34 of the aircraft, said it couldn't forecast the impact of the groundings beyond the first quarter.
"As of today, the Company has reduced its published flight schedule through April 20, 2019, and is currently evaluating future schedule reductions," it said in the filing.
The company also singled out "unscheduled maintenance disruptions" as taking a bite from its revenue. Southwest said last month that it was struggling to keep up with an unusually high number of aircraft taken out of service for maintenance issues.
Separately, a Southwest Airlines Boeing 737 Max 8 experienced engine trouble shortly after takeoff on Tuesday, prompting pilots to return to the Orlando International Airport. The plane, which was heading to a storage facility in Victorville, California, carried no passengers. The plane's No. 2 engine began to overheat after takeoff, after ingesting debris on the runway which caused a buildup of exhaust. Southwest Airlines said the engine did not blow out.