Boeing Secures Major 737 Max Order Amidst Turmoil
In a significant boost to the US manufacturer, Boeing has landed a massive $10 billion order for 80 737 Max jets from Dublin-based aircraft leasing firm Avia. This deal marks the first major win for Boeing since the end of a seven-week strike that crippled production and resulted in estimated losses of $10 billion.
A Vote of Confidence in the 737 Max
The purchase is a testament to Avia’s faith in the 737 Max, which was grounded earlier this year following an investigation into a near-disastrous incident. The aircraft has been plagued by quality control and safety issues, but Avia’s chairman, Gediminas Žiemelis, believes Boeing will bounce back from the crisis. “We are big believers in Boeing,” he said. “The Max is a flexible aircraft that is suited to operating across the world.”
Deliveries to Commence in 2030
The deal, comprising 40 firm orders and 40 options, is valued at around $10 billion at list prices. Deliveries are set to begin in 2030, giving Avia an advantage in offering these jets to its customers. According to Žiemelis, no other lessors are due to take delivery of the Max 8 around that time.
Avia’s Business Model
Avia, the world’s largest provider of airliners for seasonal hire, has a unique business model that allows airlines to meet surging demand without being stuck with excess capacity. The company offers aircraft on wet leases, complete with crew, maintenance, and insurance, providing an alternative to buying planes outright or hiring them on traditional long-term leases.
Expanding Fleet and Global Reach
The purchase promises to expand Avia’s current fleet of 220 aircraft by more than a third. The company’s strategy relies on placing jets with customers in the southern hemisphere when they are no longer required further north. With a license to operate planes in Australia and Indonesia, Avia is working to fulfill requirements in Brazil, Malaysia, and Thailand, with Qantas, Virgin Australia, and Azul among prospective clients.
A Flexible Fleet for a Global Market
Žiemelis emphasized the importance of having an adaptable fleet, saying, “Our fleet needs to be adaptable for the entire global market. The planes are like migrating birds, flying from where it is cold to where it is warm to meet demand.” With this deal, Avia is poised to expand its global reach and capitalize on the growing demand for air travel.
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