Not afraid of the 737 MAX: Boeing logs first scalable orders
The order book for the Boeing 737 MAX, stagnant since the global grounding of the jet in March 2019, has seen a major boost at the Dubai Airshow. Airlines have given the MAX their seal of approval with a total of 50 orders placed within just two days of the event. It comes at a crucial time for Boeing, as the manufacturer aims to shore up support for the 737 MAX before its return to the skies currently expected in early 2020.
A day after securing the first firm order for the 737 MAX from Turkish carrier SunExpress, Boeing and Air Astana announced on November 19, 2019, an order for 30 737 MAX 8 jets destined for the airline’s brand-new low-cost subsidiary FlyArystan. Signed as a letter of intent (LoI), the order is valued $3.6 billion at list prices.
Back in November 2018, the flag carrier of Kazakhstan, Air Astana, announced that it will be launching a budget airline (the first LCC in the country) in hopes to better compete in the growing low-cost segment. The new Almaty-based carrier called FlyArystan commenced operations on May 1, 2019, and has so far seen strong ticket sales, “exceeding all expectations”, according to the parent company.
Boeing states that Air Astana’s new 737 MAX 8s will serve as the “backbone” of the new low-cost carrier. FlyArystan currently flies three Airbus A320-200s and has previously revealed plans to expand its fleet to 15 aircraft by 2022. Its parent company, Air Astana, which began operations in May 2002, operates a fleet of 35 aircraft, consisting of Boeing 757s and 767s, Airbus A320 family planes (A320s and A321s in both ceo and neo versions), as well as Embraer 190 and E190-E2 jets.
President and CEO of Air Astana Peter Foster has expressed confidence in the 737 MAX: "Air Astana has had a strong relationship with Boeing ever since the airline started flying in 2002 with a pair of 737NGs. Today we operate both 757s and 767s and we believe that the MAX will provide a solid platform for the growth of FlyArystan throughout our region, once the aircraft has successfully returned to service.”
Air Astana’s order follows SunExpress’ deal announced the day before, on November 18, 2019. The Turkish leisure carrier – a subsidiary of Turkish Airlines and Lufthansa (LHAB) (LHA) – stated it is exercising options for an extra 10 737 MAX 8 jets, in addition to a previous order for 32 MAX aircraft. The agreement is valued at $1.2 billion at list prices and, together with Air Astana’s order, brings the total sum for the 737 MAXs to $4.8 billion.
"We have full confidence that Boeing will deliver us a safe, reliable, and efficient aircraft. However, it goes without saying that this requires the undisputed airworthiness of the model, granted by all relevant authorities," - said CEO of SunExpress Jens Bischof
SunExpress initially ordered 15 737 MAX 8 jets, including options for another 10 MAX 8s, back in 2014. It was part of a major purchase agreement for up to 50 Boeing aircraft, including 25 737-800NG airliners. Over the years, the Turkish carrier has proven to be a loyal customer for Boeing, steadily expanding its fleet of mostly Boeing 737s. The airline currently operates 65 737-800s as well as seven Airbus A330-200s.
Echoing Air Astana chief’s words, the CEO of SunExpress Jens Bischof stated: "We have a long standing, strong and trustful relationship with Boeing and thus we decided to turn our option into an order. We stand behind our strategic decision to phase the 737 MAX into our fleet for all of its economic and ecological advantages, mid- and long-term." According to Bischof, the company has “full confidence” in Boeing’s ability to resolve issues with the MAX and “deliver us a safe, reliable, and efficient aircraft”.
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