Boe­ing bonanza

Malaysian Air­lines or­ders up $5.5 bil­lion in new 737s


Boe­ing Co won an or­der for 25 737 MAX jets from Malaysia Air­lines Bhd, as the South­east Asian na­tion’s flag car­rier ex­pands its fleet for the first time since two fa­tal air crashes in 2014 prompted the gov­ern­ment to take over the com­pany.

The op­er­a­tor also has op­tions for 25 more, with the com­bined deal val­ued at $5.5 bil­lion in­clud­ing the op­tions, the air­line said in a state­ment on Wed­nes­day. De­liv­er­ies from theChicago-based man­u­fac­turer are set to start in 2019. The New Straits Times ear­lier re­ported the im­pend­ing or­der.

The or­der is for a mix of 737 MAX 8 and 9 mod­els, which, ac­cord­ing to Boe­ing, have a list price of $110 mil­lion and $116.6 mil­lion each.

The ad­di­tion to its fleet­may help Malaysia Air­lines, which is in the midst of a 6 bil­lion ring­git ($1.5 bil­lion) busi­ness over­haul, com­pete against a slew of bud­get car­ri­ers in the re­gion. Pas­sen­ger con­fi­dence in the car­rier, now­ful­ly­owned bysovereign­wealth­fundK­haz­anah Na­sional Bhd, took a dive two years ago after Flight MH370 van­ished onMarch 8, 2014 and an­other was shot down over Ukraine four months later.

The Malaysian car­rier cur­rently has 56 737-800s, 15 A330-300sand­sixA380s inits fleet, ac­cord­ing to its web­site.

The air­lines this month named Peter Bellew as chief ex­ec­u­tive of­fi­cer, its third in two years, adding the ap­point­ment will en­sure con­ti­nu­ity in the ex­e­cu­tion of the turn­around plan. The Asian car­rier is ahead of sched­ule with its restruc­tur­ing, hav­ing reached break even re­cently, putting it on course for a full-year profit in 2018 as tar­geted, if not ear­lier, for­mer CEO Christoph Mueller said in June.

The plane pur­chases may help cut op­er­at­ing ex­pen­di­ture by about 15 per­cent, Bellew­said on­Wednes­day.

This month, Boe­ing raised its long-term fore­cast for air­craft or­ders, say­ing the rise of discount car­ri­ers and growth in de­vel­op­ing coun­tries will fuel pur­chases de­spite re­cent eco­nomic tur­moil from Brexit and a com­modi­ties slump.

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