American Airlines Group Inc. (AAL) said Wednesday that it plans to extend cancellations linked to the grounded Boeing Co. (BA - Get Report) 737 MAX into at least early January, challenging the planemaker's timetable for the troubled aircraft's return.
American said it plans to gradually return the 737 MAX into its flight schedule staring January 16, noting it was in "continuous contact with the Federal Aviation Administration (FAA) and Department of Transportation" regarding the impending software updates for the grounded aircraft. Boeing has said repeatedly that it expects the 737 MAX will be certified and returned to service in the fourth quarter of this year.
The FAA said Tuesday that it's still reviewing Boeing's proposed software changes, adding that its "first priority is safety" while cautioning that it has "set no time frame for when the work will be completed."
American Airlines shares were marked 3.95% higher at the start of trading Wednesday to change hands at $26.86 each, but are still nursing a year-to-date decline of around 16.3%. Boeing shares, meanwhile, pared earlier gains to trade 0.16% higher at $374.89 each.
In a separate release, American said it expects 737 MAX cancellations will hit third quarter pre-tax income by around $140 million, and sees third quarter growth in TRASM, a key industry metric that measures revenues for available seat miles, of between 1.5% and 2.5%.
Boeing reported a net order tally of -84 jets for the nine months ending in September, compared to 127 for its European rival Airbus (EADSY) , but said indicated it had converted at least one previous order into a potential 737 MAX deliver.