Boeing 737 MAX logs first firm order from launch customer Southwest Airlines

The 737 MAX now has another customer. Southwest Airlines, the world’s largest Boeing 737 operator has announced an order for 150 of the re-engined 737s, as well as 58 next generation 737s. The order for 208 planes, worth almost US $19 billion at list prices, represents the largest single order in Boeing history, topping previous orders from Emirates and Lion Air this year.

Southwest Airlines currently operates 565 Boeing 737 aircraft (excluding those of merger partner Air Tran), 370 current generation 737-700s, and 195 Boeing 737 classics. The new order increases their order backlog to 341 737s, plus 65 further orders for 737-700s held by AirTran.

Southwest will be the launch customer for the 737 MAX, with first delivery tentatively scheduled for 2017. No indication has yet been given as to the delivery schedule for the 737 NGs.

According to Boeing, the 737 MAX currently has more than 900 firm orders and purchase commitments from 13 different customers. Boeing maintains that the 737 MAX, which will be powered by CFM International’s LEAP-1B engines, will provide 10-12% better fuel burn and CO2 emissions than current generation 737s and 7% better operating economics than the Airbus A320neo.

For Southwest Airlines, the order is not surprising; the carrier has been very complimentary of the MAX since it was launched. Grappling with labor cost increases and plateauing growth, Southwest had chosen to reduce its fuel expenditures to keep unit costs manageable.

Regardless, congratulations to both Southwest and Boeing for signing this deal.

About Vinay Bhaskara

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