Jakarta-based Lion Air has finalized a firm order for 201 Boeing 737 MAX 9s and 29 Boeing 737-900ERs, making the Indonesian carrier the global launch customer for the 737 MAX 9.
The agreement, first announced last November in Indonesia, also includes purchase rights for an additional 150 aircraft.
With orders for 230 aircraft valued at $22.4 billion at list prices, this deal is the largest commercial-aircraft order ever in Boeing’s history by both dollar value and total number of aircraft, surpassing the December 13 order by Southwest Airlines for 150 Boeing 737 MAX jets and 58 Boeing 737NGs. Lion Air will also acquire purchase rights for an additional 150 aircraft.
Included in the total price will be the aircraft’s engines. Engine maker CFM International values the LEAP-1B engine order for the 201 737 MAX 9 at approximately $4.8 billion at list price. The CFM56-7B engine order to power the 29 Boeing 737-900ERs is valued at $580 million at list price.
However, Lion Air is unlikely to pay anywhere close to the announced $22.4 billion list-price cost of the 230 aircraft, in 2012 dollars. Net prices for commercial-jet orders – particularly orders as large as the Indonesian carrier’s – routinely are discounted by 30 per cent or more and sometimes by more than 50 per cent.
“The 737 MAX is the best choice for Lion Air and the best airplane to serve our passengers,” said Rusdi Kirana, Lion Air’s founder and president director. “We’re excited to be the first airline in Asia to fly the 737 MAX and to be the global launch customer of the 737 MAX 9.”
“Lion Air has been a leader in Indonesia from the very beginning,” said Dinesh Keskar, vice president of Asia-Pacific and India sales for Boeing Commercial Airplanes. “Today more people are flying in Asia at lower fares because of the 737 and this historic 737 MAX order will help connect more people in the future.”
Along with certain other design changes, the Boeing 737 MAX will feature new CFM International LEAP-1B engines, still under development by the CFM International joint venture between General Electric and France’s Snecma and expected to enter service in 2016.
A larger-fan version of the LEAP engine, the LEAP-1A, is offered as one of two engine choices on the Airbus A320neo family, which competes head-on with the 737 MAX family. The other engine is the Pratt & Whitney PurePower PW1500G geared turbofan.
Boeing claims airlines operating the 737 MAX will see a 10 to 12 per cent fuel burn improvement over today’s most fuel efficient single-aisle aircraft and a 7 per cent operating cost per seat advantage over the A320neo family.
Various aircraft analysts question these claims, not only because the designs of the 737 MAX and the LEAP engine have not yet been finalized but also because its engine fan diameter will be smaller than than the two engine choices offered for the A320neo and thus the LEAP-1B engine might be less efficient.
Members of the 737 MAX family will, however, weigh slightly less than their corresponding Airbus counterparts.
To date, the 737 MAX has orders and commitments for more than 1,000 aircraft from 15 customers and the Next-Generation 737 family has won orders for more than 6,600 aircraft.
Lion Air, Indonesia’s largest private airline, currently operates or has on order a total of 178 Boeing 737NGs.