Exclusive-Southwest Airlines expects certification of Boeing's 737 MAX 7 by April - company exec

By Rajesh Kumar Singh and David Shepardson

CHICAGO (Reuters) - Southwest Airlines expects Boeing's 737 MAX 7 plane will get certification from the U.S. Federal Aviation Administration by April, allowing the carrier to start flying the aircraft in October and November 2024, a company executive told Reuters.

Dallas-based Southwest is the largest customer of the plane, the smallest model in Boeing's MAX family. Last month, it unveiled new orders for an additional 108 MAX 7 planes for deliveries through 2031.

"For our internal planning purposes, we assume it'll be certified in April and then flying for us in the October-November time frame," Andrew Watterson, chief operating officer at Southwest, said in an interview late Thursday.

He said, however, that the April estimate includes a buffer and certification could still happen this year or in early 2024 as Boeing is making progress with the FAA resolving open items on certification. "We don't want a delay to affect our plans so we put padding in there," Watterson said.

"We're getting closer and closer," Watterson said of the certification work. "We're towards the end here."

Boeing has said it expects MAX 7 certification by the end of this year. In October, company executives said its schedule remained unchanged, with CEO Dave Calhoun saying the company will give the FAA "all the flexibility they need" to make the call.

A Boeing spokesperson declined to comment further.

The MAX 7 is expected to provide Southwest flexibility to adjust capacity to suit demand as passenger traffic tends to vary depending on the time of day and the day of the week.

However, delays in certification have forced Southwest to convert dozens of orders for 150-seater MAX 7 aircraft into the larger 175-seater MAX 8 variant.

The Federal Aviation Administration, which did not immediately comment Friday, has repeatedly declined to comment on the timing of the MAX 7 certification, saying "safety dictates the timeline of certification projects."

MAX planes were grounded worldwide following two crashes in 2018 and 2019 that killed 346 people.

Both the MAX 7 and the largest model MAX 10 are waiting for the FAA's certification, with MAX 10 slated for its first delivery in 2024. They are seen as critical for Boeing to compete against Airbus for orders at the top and bottom of the narrowbody markets.

"The fact that the number of open items is converging, not diverging like it was probably a year ago, shows that they're getting closer and closer," Watterson said.

Some analysts and industry officials say flying a bigger plane with more seats in a domestic market that is already flooded with excess capacity is hurting Southwest's profits.

Watterson, however, disagreed with that view. He said the airline has a decent balance of big and smaller aircraft to match supply and demand.

"If we were like 80 big aircraft, 20 smaller aircraft that would be a problem, but we're 50-50 right now," he said. "So, we have plenty of latitude."

(Reporting by Rajesh Kumar Singh and David Shepardson; Additional reporting by Valerie Insinna in Washington; editing by Diane Craft)