American Airlines is trimming its revenue outlook for the first quarter, citing financial costs and disruptions related to the grounding of the company’s fleet of Boeing 737 MAX 8 aircraft and the temporary removal of 14 Boeing 737-800 aircraft for maintenance.

The Dallas/Fort Worth-based carrier now expects 1Q total revenue per available seat mile (TRASM) to fall within a range of 0-1% year-over-year (YOY), versus previous guidance of flat to up to 2%. The company said the change was primarily related to the grounding of its MAX fleet, its sidelined 737-800 aircraft and the US government shutdown that ended in February.  

CASM-ex fuel, meanwhile, is expected to come in at 3%, down from previous guidance because of lower-than-anticipated salaries and benefits costs. Excluding special items, American now forecasts 1Q pre-tax profit margin at a range of 2%-4%, slightly down from initial estimates of between 2.5% and 4.5%.

While CASM-ex improvement was greater than the reduction in TRASM guidance, pre-tax margin estimates came in lower because of higher fuel prices. American expects to pay between $2.02 and $2.07 per gallon of jet fuel in the first quarter, excluding taxes.

On March 7, American announced the unplanned removal of 14 Boeing 737-800 aircraft from service for remediation work following the installation of new interiors, leading to a cancellation of roughly 940 flights in 1Q. Those complications were compounded on March 13 when the FAA grounded all US-registered Boeing 737 MAX aircraft, causing the company to cancel a further 1,200 flights in the quarter. The carrier has 76 additional 737 MAX aircraft on order from Boeing.

American has announced further cancellations through June 5 under the assumption that the MAX 8 will not be available through that date. The carrier said that financial costs associated with that disruption for 2Q could not yet be forecasted.

Ben Goldstein,