Boeing and Lion Air Agree on Record-Breaking Deal

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Uploaded on February 15, 2012 by newsydotcom

(Image Source: benzinga)



BY BRIAN BONDUS

ANCHOR ANA COMPAIN-ROMERO



Boeing closed the largest commercial deal in its history Tuesday. KOMO has the finalized details.



“The deal with Indonesia-based Lion Air includes 201 737 max jets, and 29 next- generation 737's. It also includes an option to buy 150 more planes.”



The total cost of the transactions — $22.4 billion. This is the largest order for Boeing in terms of total number of planes sold and in dollar value. Lion Air is located in the fourth most populated country in the world and Bloomberg reports the airliner will not have trouble finding customers.



“The Jakarta-based company expected to carry 27 million passengers last year, an increase of 30 percent, and it has forecast future growth of about 15 percent a year.”



Europe's Airbus was also competing for Lion Air’s business. Airbus has a fuel efficient aircraft that outsold Boeing’s 737 last year. Boeing responded with the 737 Max, a fuel efficient craft of its own. The Max aircraft make up the bulk of the new order. The Bangkok Post reports Boeing believes it’s worth competing for the Asian market.



“Boeing expects Asia-Pacific airlines to lead growth in the global aviation industry, projecting orders of planes worth US$1.5 trillion over the next 20 years.”



Boeing's deal with Lion Air does have some people concerned. 24/7 Wall Street cites some questions with the company.



“Lion Air has a poor safety record. It cannot fly to EU nations because of concerns. The International Air Transport Association, the industry’s primary alliance, will not grant Lion Air’s application for membership. The reason, again, is safety.”



Lion Air hopes to be allowed to fly in Europe again soon. Boeing’s 737 Max’s are still in testing and are scheduled for delivery in 2017.

Tags:
Lion Air, Boeing, Boeing Lion Air Deal, Lion Air Indonesia, Airbus, Business News, Lion Air Record Deal, News & Events
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