The Aftermath of an Emergency Landing for Alaska Airlines

The recent emergency landing of an Alaska Airlines 737 MAX 9 flight has left both nervous flyers and airline investors on edge. This incident is particularly troubling for Alaska Air, as it experienced the worst-performing U.S. airline stock, suffering a loss of 4.4% in early trading. With the unfortunate event happening on one of its flights, Alaska Air finds itself highly dependent on the MAX 9 jet, with a fleet of 65 aircraft, accounting for over 20% of its total fleet of 314 planes.

While Alaska Air bears the brunt of this situation, United Airlines also faces some pressure as the largest operator of the MAX 9 with a fleet of 79 aircraft. However, given its significantly larger fleet, the MAX 9 only represents 8% of United's total number of planes. Another airline impacted by this ordeal is Copa Airlines, the national carrier of Panama, which operates 29 MAX 9 aircraft. As a result, United Airlines stock experienced a minor dip of 0.3%, while Copa Airlines' parent company, Copa Holdings, listed in the U.S., saw a decrease of 1.5%.

On the other hand, the major U.S. airlines do not have any MAX 9 aircraft in their operations. Aeromexico currently has 19 MAX 9 planes in service, Turkish Airlines operates five, and Icelandair has four.

The implications for airlines operating the MAX 9 jets remain unclear at this time. The Federal Aviation Administration has issued a temporary grounding order, requiring thorough inspections of these planes before they can safely return to the skies.

Boeing 737 MAX Grounding: Temporary Interruption for Alaska, United, and Copa Airlines

The recent temporary grounding of Boeing 737 MAX jets may have brought back memories of the global grounding in 2019 following two fatal crashes. However, this time the impact is expected to be less severe.

Alaska, United, and Copa Airlines are among the airlines affected by the grounding. United has already canceled 260 flights, which accounts for 9% of its schedule, on Sunday and an additional 204 flights, or 7% of its Monday flights. Alaska Airlines, on the other hand, had to cancel 165 flights (21% of its schedule) on Sunday and another 139 flights (20% of its schedule) early Monday. Copa Airlines had to cancel 14% of its flights on Sunday and 21% so far on Monday.

While the temporary grounding will likely have some financial impact on these airlines, analysts believe that certain factors will limit the overall effect. For one, January tends to be a relatively slow month for the industry, and the timing of the grounding after the holidays is less detrimental. Additionally, this quarter has an extra day of travel due to the leap year, which could help boost earnings.

TD Cowen analyst Helane Becker expects Alaska, United, and Copa to have a better estimate of the financial impact when they report their fourth-quarter earnings in the coming weeks.

J.P. Morgan analyst Guilherme Mendes remains optimistic that the problems will be short-lived. He has highlighted Copa Airlines as his top pick among Latin American airlines and rates the stock as Overweight. Mendes also points out that most carriers anticipate completing the necessary inspections in the next few days, allowing the grounded MAX 9s to resume operation.

Overall, while the temporary grounding may cause some disruptions for Alaska, United, and Copa Airlines, industry analysts and experts believe that the impact will be manageable and short-lived.