By Eric M. Johnson SEATTLE, Dec 22 (Reuters) - Alaska Airwa
By Eric M. Johnson
SEATTLE, Dec 22 (Reuters) – Alaska Airways ALK.N has agreed to purchase 23 Boeing Co BA.N 737 MAX 9 jets, the businesses stated on Tuesday, confirming an Oct. eight Reuters report that the U.S. planemaker was in talks with Alaska to stimulate demand for the jet’s comeback.
The order, price some $2.96 billion at checklist costs earlier than anticipated steep reductions, comes lower than three weeks after European finances airline Ryanair RYA.I additionally positioned a lifeline order for 75 Boeing 737 MAX jets.
Boeing is battling to construct momentum for the 737 MAX as its cash-cow jetliner re-enters industrial service following a 20-month security ban triggered by deadly crashes.
“We prefer to maintain the stability sheet sturdy in order that in instances like this we may be contrarian and make strikes to basically enhance the aggressive place of the corporate,” Alaska Airways Chief Govt Brad Tilden informed Reuters.
Tilden declined to debate the ultimate price ticket, or whether or not France-based Airbus AIR.PA had submitted a rival proposal.
The deal was anticipated to incorporate important reductions given the 737 MAX’s latest woes and plunging demand for airplanes in the course of the coronavirus disaster, business sources have stated.
Even at a fraction of the MAX’s checklist value of $129 million, the deal may assist Boeing to stem a money hemorrhage brought on by a stockpile of roughly 450 undelivered MAX jets.
The deal additionally accelerates a shift in Alaska’s fleet again in the direction of Boeing from Airbus. Alaska Airways operated an all-Boeing fleet till it acquired Virgin America in 2016.
Seattle-based Alaska Airways, the fifth largest U.S. passenger service, flies 166 older Boeing 737s and 71 Airbus A320-family plane.
Alaska, which already had ordered 37 MAXs earlier than the grounding, has one of many strongest stability sheets amongst U.S. airways. Analysts consider it may change into extra aggressive than its friends after the pandemic.
In late November, Alaska Air Group Inc ALK.N stated it might lease 13 new Boeing 737 MAX 9 planes from Air Lease Corp AL.N, and stated it might promote 10 Airbus A320s to Air Lease.
(Reporting by Eric M. Johnson in Seattle; Modifying by Richard Chang)
(([email protected]; +1 206 707 1218; Comply with me on Twitter @ByEricMJohnson;))
The views and opinions expressed herein are the views and opinions of the writer and don’t essentially replicate these of Nasdaq, Inc.