Posted on: 16 July 2018 by Mark Howells
Boeing has sealed approximately US$16 billion of orders for its B737 MAX 8 single-aisle aircraft on the first day of the Farnborough Airshow, including one for 75 from India’s Jet Airways.
The order by the Indian carrier was signed at the show and is valued at $8.8 billion at list price. Others deals unveiled earlier in the day saw lessor Jackson Square Aviation (JSA) place its first direct order from a jet maker, signing for 30 B737 MAX 8 aircraft in a $3.5 billion deal at the show, while another lessor, Goshawk Aviation Ltd, signed for 20 MAX 8s in a $2.3 billion order.
Brazilian airline GOL, meanwhile, placed an order for 15 MAX 8s as part of a larger deal that also saw it convert 30 existing MAX orders (including some MAX 8s) to the larger MAX 10.
The US manufacturer also confirmed the sale of another five MAX 8s to Romanian flag carrier TAROM, in a contract valued at $586 million.
Boeing saved its biggest deal until near the end of the first day, with the order for the additional 75 MAX 8 aircraft from Jet Airways coming in just below $9bn at list price. It had been previously posted as unidentified on Boeing’s orders and deliveries website.
The order will help the Indian carrier expand its network to meet surging demand in the world’s fastest-growing aviation market. Naresh Goyal, the airline’s chairman, said the order “emphasises Jet Airways’ commitment to the growth and potential of the Indian aviation market.”
The Mumbai-based carrier took delivery of its first MAX in June.
Jackson Square deal
Leasing company JSA’s order for its MAX 8s was the first direct purchase with Boeing, which said it “reflects the evolution of the lessor’s business and its confidence in the market for the B737 MAX.”
The order was previously unidentified on Boeing’s orders and deliveries website. JSA opted for the B737 MAX 8, in a standard two-class configuration.
Toby Bright, JSA’s chief executive officer, said: “We are excited to become even more of a full-service partner for our airline customers by expanding our fleet of 737 MAX airplanes as global demand for narrow-body jets continues to rise. The MAX is quickly becoming an important part of our portfolio and we look forward to offering this modern, fuel-efficient and reliable aircraft to airlines around the world. We have carefully evaluated how speculative orders can enhance our long-term business model, and this transaction signifies the next step in that development.”
San Francisco-based JSA was formed in 2010 and has grown steadily by buying new technology aircraft from airlines globally through sale-leaseback financing and pre-delivery payment financing agreements. It has built a portfolio of more than 180 jets with long and balanced lease terms placed with 49 customers in 27 countries.
“Jackson Square Aviation has reached significant heights since its founding, having financed more than 100 Boeing airplanes. We are proud to have been their partner and we are extremely honoured that JSA has chosen to expand its business on the wings of the 737 MAX,” said Ihssane Mounir, senior vice-president, commercial sales and marketing for Boeing.
GOL ramps up MAX orders
Brazil’s GOL Airlines converted 30 of its existing MAX orders to the B737 MAX 10, including some MAX 8 orders. But it also placed a new order for 15 more MAX 8s, growing the carrier’s total MAX orders to 135.
“This new order aligns with our strategic policy of reducing operating costs by operating a standardised fleet. We are confident that the 737 MAX 10 will offer significant competitive advantages for GOL and enable us to continue to modernise with new aircraft,” said Paulo Kakinoff, CEO. He added that they would also allow it to support a larger network, allowing it to add new destinations.
The MAX 10 seats up to 30 more passengers than the MAX 8, which seats up to 186 in the airline’s configuration. “Increased seat capacity per aircraft not only reduces the costs of providing passenger transportation, but also improves our ability to distribute passengers within our large domestic and growing international flight networks,” added Kakinoff. All-Boeing operator GOL took delivery of its first B737 MAX last month, starting a fleet renewal that will continue through 2028.
$2.3bn Goshawk deal
The Goshawk order for 20 B737 MAX aircraft, valued at $2.3 billion, also marked the first direct purchase of jets from Boeing by the lessor.
“Placing direct order is a critical part of Goshawk’s overall growth strategy and we are pleased to have finalised our order with Boeing,” said Brian Cheng, Dublin-based Goshawk’s chairman. Goshawk will have an owned, managed and committed fleet of over 220 aircraft, including this latest order for the MAX 8 in a standard two-class configuration.
The manufacturer’s contract with TAROM (Romanian Air Transport), meanwhile, will see it deliver five MAX 8s.
“This is an exciting time for TAROM as we upgrade our fleet and build strong partnerships that will benefit all of our passengers,” said Wolff Werner-Wilhelm, TAROM Airlines CEO. “The 737 MAX will provide our customers with exceptional performance, reliability and efficiency, with an extended range that will enable us to better serve our current routes and open new markets. This new acquisition represents a true statement of change for TAROM.”
Boeing’s Mounir commented: “When combined with support from our Boeing Global Services team, the MAX 8 will enable TAROM to offer a consistent and exceptional passenger experience while maximizing revenue potential at the best cost per seat in the industry.”
TAROM has a fleet of 25 aircraft and has been a member of the International Air Transport Association (IATA) since 1993.
Also on the first day at Farnborough, Boeing confirmed a repeat order for four 787-9 Dreamliners from United Airlines in a deal valued at approximately $1.1 billion at current list price, as well as five B777 freighters with Qatar Airways in a $1.7 billion deal and another 14 B777s plus purchase rights for seven more freighters with DHL in a $4.7 billion order.
Written by: Mark Thomas
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