Today at the Farnborough International Airshow in the United Kingdom, Boeing (NYSE:BA) made a variety of announcements disclosing new orders as well as a new 737 airplane.
Boeing said it has developed a new model of the 737 MAX 8 with 200 seats, 11 more than the previous model. "This new 200-seat 737 MAX 8 ensures we'll retain our leadership in comfort, capacity and lower operating costs in the heart of the single-aisle market," said Ray Conner, president and CEO of Boeing Commercial Airplanes, in a press release. "With this increase in capacity and confidence in our engine and airplane testing, we're on track to deliver a 20 percent more fuel efficient product than today's Next-Generation 737."
In addition, Boeing made a variety of announcement of new orders and potential orders, worth a total of $6 billion at list prices, though customers often negotiate to pay less than list prices.
The largest order Boeing revealed today came from Monarch Airlines, with which Boeing said it is working to finalize a purchase of 30 737 MAX 8s, which have a total list price of $3.1 billion. The press release noted this order marked the start of a move for Monarch in which it planned to undertake "a fleet transition ... to Boeing single-aisle airplanes." Monarch currently flies Airbus aircraft as well as Boeing B757-200. Headquartered at London Luton Airport, Monarch predominantly serves holiday destinations around the Mediterranean and the Canary Islands as well as European ski resorts. It has a fleet of more than 40 airplanes.
"Today's announcement is an important milestone in an exhaustive three year evaluation process, and a key part of The Monarch Group's transformation and renewal," noted Iain Rawlinson, the executive chairman of The Monarch Group, in the announcement. "Boeing truly understood our business and put together a complete package that fits extremely well with our ambitions for the Group."
"We are delighted that Monarch intends to structure its future fleet around the 737 MAX," added Ray Conner, the president and CEO of Boeing Commercial Airplanes.
Boeing also announced Ireland-based leasing company Avalon had ordered 11 additional aircraft valued at more than $2 billion at today's prices. The order includes six 787-9 Dreamliners and five 737 MAX 9 models.
"We are also pleased to reconfirm our commitment to purchase five Boeing 737 MAX 9 aircraft," said Domhnal Slattery, CEO of Avolon, in the release. The order will increase Avalon's 737 MAX portfolio to 20 airplanes.
Boeing also reported that Beijing-headquartered Okay Airways placed an order for six 737 MAX 8 planes and four Next-Generation 737-800 airplanes with total list prices at $980 million. In addition, it upgraded a previously announced five-plane order of 737-800 planes into 737-900 Extended Range models.
"The 737 is the backbone of our fleet and has fueled our growth with its proven reliability and efficiency," said Liu Weining, president of Okay Airways, China's first privately owned airline. "The addition of the new 737 MAX airplanes will help us explore new regional markets while strengthening our existing domestic routes."
Lastly, Boeing also noted it has received a contract with the U.S. Air Force worth $7.3 million over the next two years to assist in "remanufacturing warhead arming devices for the nation's air-launched cruise missile (ALCM), helping to ensure the readiness of the system." In addition the announcement noted upon the completion of the two-year contract, it has the option to have its contract extended for six additional years at a total value of $50 million.
Patrick Morris owns shares of Apple. The Motley Fool recommends Apple. The Motley Fool owns shares of Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.