Boeing Nets Major Order for Its Grounded 737 MAX Jet -- 2nd Update

Date : 11/19/2019 @ 4:20PM
Source : Dow Jones News
Stock : Boeing Co (BA)
Quote : 341.67  -4.62 (-1.33%) @ 12:59AM
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Boeing Nets Major Order for Its Grounded 737 MAX Jet -- 2nd Update

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By Benjamin Katz 

DUBAI -- Boeing Co. cinched substantial deals for its grounded 737 MAX, providing an important vote of confidence in the aircraft, while the planemaker was separately close to reviving a big order for its 787 Dreamliner, according to people familiar with the matter.

Neither order ranks as a game changer for Boeing, which is struggling through a months-long grounding of the MAX after two fatal accidents. But the MAX orders, in particular, shows that customers haven't yet given up on the plane.

Boeing said Tuesday it has agreed to deliver 30 737 MAXs to Kazakhstan's Air Astana, a deal valued at $3.6 billion at list price, but before customary discounts. The order is especially significant since the carrier had previously bought the A320neo, the narrowbody jet made by Airbus SE that competes directly with the MAX.

Boeing also signed a separate deal for 20 MAX aircraft from an undisclosed customer at the international air show in Dubai, according to a person familiar with the agreement. Boeing announced a smaller MAX order on Monday.

So far, Boeing has won orders for a combined 60 MAX jets. Before the show, it had said it had lost about 200 MAX orders this year, blaming airline bankruptcies and swaps that carriers have made for other aircraft amid the MAX grounding.

Boeing shares were up marginally in early trading.

The MAX orders are critical for Boeing at a time when it's trying to keep customers from abandoning the jet. It has said it expects the plane to be recertified by the end of the year. The grounding has provided an opening for arch rival Airbus to steal orders. Airbus announced a deal on Monday for 100 A320neos from Air Arabia, a carrier that could have also gone with the MAX.

Boeing is also close to resuming a big deal it thought it had lost, according to people familiar with the matter: a $15 billion list price agreement by Emirates Airline to buy 40 of its 787 Dreamliners. Boeing has recently struggled with lackluster demand for the twin-aisle jet, amid a dearth of orders from China, and headwinds generally for the market for big planes.

Boeing could announce the revived deal as soon as this week, according to people familiar with the matter. The original agreement was announced at the Dubai Air Show in 2017, but lapsed. The number of jets in the revived deal will likely be fewer than the proposed 40, people familiar with the matter said.

Separately this week, Emirates placed an order for 50 Airbus A350s, another large jet that competes with the 787. It hasn't yet agreed, though, on a preliminary commitment to buy the European plane maker's A330neo, which also competes with the 787.

Write to Benjamin Katz at ben.katz@wsj.com

 

(END) Dow Jones Newswires

November 19, 2019 11:05 ET (16:05 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.

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