An $18 billion start for Renton-built 737 at Farnborough Airshow
By DEAN RADFORD
Renton Reporter Editor
July 10, 2012 · 5:31 PM
Here are three of the major deals involving the new MAX and the Next Generation, totaling about $18 billion:
• The Kuwait airplane leasing company ALAFCO ordered 20 Boeing 737 MAX 8s valued at $1.9 billion at list prices.
"This is the first commitment for the 737 MAX from the Middle East which is one of the aviation industry's highest growth regions," said Ray Conner, newly named president and CEO of Boeing Commercial Airplanes.
• GE Capital Aviation Services, the commercial aircraft leasing and financing arm of General Electric, has committed to purchase 75 737 MAX 8s and 25 Next-Generation 737-800s.
At list prices the deal is worth about $9 billion. Boeing is working with the company to finalize the order.
"The 737 MAX is a perfect complement to our airplane portfolio," said Norman C.T. Liu, president and CEO of the leasing company in a Boeing press release. "These new Next-Generation 737 and 737 MAX airplanes will continue our long-standing strategy of providing our customers the most fuel efficient, most capable airplanes with the lowest operating costs."
• Air Lease Corporation announced a firm order for 60 737 MAX 8 and 15 737 MAX 9 airplanes, with reconfirmation rights for 25 additional 737 MAXs. The order, with a list-price value of $7.2 billion, represents the first 737 MAX order by a leasing company, according to Boeing.
"The 737 MAX is an excellent addition to our portfolio and the ideal complement to our growing fleet of Next-Generation 737-800s," said Steven Udvar-Hazy, chairman and CEO of Air Lease Corporation, in a Boeing press release. "The 737 MAX represents a step-change improvement that our airline clients need to compete in the future."
The 737 MAX is a new-engine variant of the world's best-selling airplane and builds on the strengths of today's Next-Generation 737, according to Boeing.
To date, the 737 MAX has orders and commitments for more than 1,000 airplanes and the Next-Generation 737 family has won orders for more than 6,600 airplanes.
On Monday, Conner laid out his goals during the opening day of the air show, saying the company is hitting its stride on performance and making significant progress on new airplane programs.
"We're seeing levels of demonstrated performance that give us confidence in our ability to increase production rates and deliver on our promises to customers," said Conner in a company news release "We're also working closely with our suppliers to make sure they're able to increase capacity and make the necessary investments to go up in rate with us."
The Boeing backlog stands at more than 4,000 airplanes, equating to nearly seven years of production at current rates. In the first half of 2014, Boeing will be producing 30 percent more airplanes than today. In addition, Boeing's 2012 Current Market Outlook forecasts a market for 34,000 airplanes worth $4.5 trillion over the next 20 years, according to a company press release.
On Tuesday the 737 program general manager announced more progress on the on the 737 MAX.
"We continue to make steady progress toward our development goals," said Beverly Wyse, vice president and general manager, 737 program. "We are able to firm up our maximum takeoff weight projections, which allow us to confirm that the 737 MAX will fly farther and offer more revenue potential than its predecessor and its future competitor."
The 737 MAX will extend the Next-Generation 737 range advantage. The 737 MAX models will have the capability to fly more than 3,500 nautical miles, an increase of 400 – 540 nmi over the Next-Generation 737, according to the company.
"This will allow our customers the flexibility to open up new markets," said Joe Ozimek, vice president of 737 MAX Product Marketing. "737 customers today enjoy a range advantage over the competition and now they'll have even more benefit with the 737 MAX."Contact Renton Reporter Editor Dean Radford at email@example.com or 1-425-255-3484 (ext 5050).