Alaska Air Is Still Betting on the Boeing 737 MAX
In early October, Alaska Air (NYSE: ALK) gave investors a big hint that it plans to phase out its Airbus A320-family jets and return to an all-Boeing (NYSE: BA) fleet. The airline announced that it would take an impairment charge for the 10 A320s it owns -- the vast majority of its Airbus fleet is leased -- and retire those planes early.
Last Monday, Alaska provided more details about how it will execute its upcoming fleet transition. The company reached an agreement to sell its 10 owned A320s to Air Lease Corporation (NYSE: AL) in exchange for leasing 13 new Boeing 737 MAX 9s.
Alaska Air recorded a $121 million impairment charge in its third-quarter earnings as it reduced the book value of its 10 owned A320s to their estimated market value. However, that didn't clarify how the company would actually dispose of those planes. Due to the pandemic, it's hard to sell used jets at any price right now.
Source Fool.com
