IAG, Boeing negotiate 737 MAX deliveries to start in 2022
International Airlines Group (IAG) is negotiating with Boeing new delivery date for the first of 200 Boeing 737 MAXs it has on (preliminary) order. While some airlines nowadays find themselves in a situation where delivery dates of the grounded jet are pushed back, IAG wants just the opposite ‒ to take the first batch a year earlier than initially planned, says the group’s CEO William Walsh, calling the negotiations “positive” and “very constructive”.
Initially, the deliveries were expected to begin in 2023 and last until 2027, but now the group is negotiating an earlier MAX entrance to service with them. “We're having very, very constructive discussions with Boeing,” William Walsh, IAG CEO and Executive Director told investors during Q2 2019 earnings call on August 2, 2019.
“And the LOI that we signed talked about deliveries between 2023 and 2027, we're actually looking to see if we can get some of those deliveries in 2022, and the engagement with Boeing has been very positive and very constructive,” Walsh said.
During the Paris Air Show back in June 2019, International Airlines Group (IAG) announced intention to acquire 200 Boeing 737 MAX jets. The aircraft, of 737-8 and 737-10 versions of the MAX, would be distributed among several airlines of the group, including Vueling, LEVEL and British Airways. The deal, valued at over $24 billion at list prices, was signed in the form of a letter of intent (LoI) and is not yet firm.
With this LoI order, IAG became the first company to place a sizable 737 MAX order since the aircraft was globally grounded on March 13, 2019, following two crashes involving the aircraft that cost the lives of 346 people. However, while IAG is willing to overlook the negative publicity that currently surrounds the aircraft model, the group was careful not to mention the infamous “MAX” whist referring to the new generation 737. Instead, IAG refers to the model as simply 737 or 737-8, 737-10.
The 200 737s order marks a subtle yet significant change in the group’s fleet structure. IAG Group, the parent company of British Airways, Iberia, Aer Lingus and Vueling, has a combined fleet of 588 aircraft (as of June 30, 2019). While the U.S. manufacturer is already IAG’s manufacturer of choice for wide body aircraft, so far most of its narrow body planes were made by Airbus. In total, IAG airlines operate 373 Airbus narrow bodies (ranging across Airbus A318, A319, A320 and A321 variants) and 23 Embraer aircraft (E170 and E190). Of the wide body aircraft, it has 72 Airbus (A330, A340, A350, and A380) and 121 Boeing (747, 777, 787) airliners.
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