Boeing Gains $11 Bln Order Commitment From Ryanair As It Launches 737 MAX 200

(RTTNews) - Aerospace giant Boeing, Inc. (BA) on Monday eked out an order commitment for 100 airplanes low-cost Irish airline Ryanair Holdings plc (RYA.L) as it launched the newest member of the 737 MAX family, the 737 MAX 200. The new aircraft model will have 11 additional seats that will lead to a total seating of up to 200.

"Ryanair is proud and honored to become the lead operator of Boeing's 'gamechanger' 737 MAX 200, which will expand our fleet to 520 aircraft by 2024 and create another 3,000 new jobs for pilots, cabin crew and engineers in Europe, while allowing us to grow traffic from 82 million last year to over 150 million annually by 2024," Ryanair CEO Michael O'Leary said.

The order commitment is part of Ryanair's fleet expansion and is valued at $11 billion at current list prices. The airline also has options to purchase another 100 737 MAX 200s.

The 737 MAX 200 is a variant of the successful 737 MAX 8 that can accommodate up to 200 seats, which will increase revenue potential and providing customers up to 20 percent better fuel efficiency per seat than today's most efficient single-aisle airplanes. It will also lower operating costs by up to 5 percent than the 737 MAX 8.

Dublin-based Ryanair, Europe's largest budget airline, will be launch customer and the first airline to operate the 737 MAX 200. Ryanair noted that the new "gamechanger" aircraft variant will enable it to lower costs and airfares, while improving customer experience with more leg room and the Boeing Sky Interior.

Ryanair said it looks forward to using these new Boeing 737 MAX 200s to grow at many more of Europe's primary airports even as many of Europe's flag carriers cut capacity on short haul routes.

As discussions went on to finalize a deal, Ryanair has been urging Boeing for the additional seats. Boeing is said to have agreed in July to build a 737 MAX 8 variant with 200 seats instead of the normal 189 seats.

Dublin-based Ryanair, Europe's largest budget airline, currently operates an all-Boeing fleet of more than 300 next-generation 737-800s. It took delivery of its first 737 in 1994. This will be Ryanair's first order for the new 737 MAX family aircrafts.

Ryanair had last year finalized an order for 175 current generation 737-800s, the first of which is expected to be delivered later this month. It will expand Ryanair's fleet to more than 400 737-800s.

Ryanair describes itself as Europe's favorite low fares airline, operating more than 1,600 daily flights connecting 186 destinations in 30 countries.

Boeing's 737 MAX, the top selling narrow-body single-aisle planes, competes with the A320neo's manufactured by Boeing's European rival Airbus Group N.V. (EADSF, EADSY). The 737 MAX is a new-engine variant of the world's best selling Boeing 737 airplane and builds on the strengths of Next-Generation 737.

Boeing's 737 MAX family of aircrafts are powered with the latest-technology LEAP-1B engines from CFM International, a joint venture of General Electric Co. (GE) and Safran SA. Meanwhile, the A320neos offer a choice of engines either from CFM or Pratt & Whitney, a unit of United Technologies Corp. (UTX).

Chicago, Illinois-based Boeing had revealed in May 2014 that it has breached the 2000 mark for orders for its 737 MAX super-efficient single-aisle airplane from 41 customers worldwide, including from airlines and aircraft leasing companies. The orders currently stand at 2,239 from 46 customers. The company also has commitments for more than 250 additional 737 MAX airplanes.

The unprecedented demand for 737 MAXs is fueled by air traffic growth and the need for more fuel-efficient airplanes. The aircraft has been quite popular due to its 14 percent more fuel efficiency and lowest operating costs with an eight percent operating cost per seat advantage over tomorrow's competition.

"The 737 MAX 200 is the perfect fit for Ryanair, providing improved efficiencies, 20 percent lower emissions, increased revenues and a high level of passenger comfort. The new variant will play a significant role in enabling the airline to continue to expand its operations, while providing passengers across Europe with outstanding value," said Boeing Commercial Airplanes President and CEO Ray Conner.

In Monday's regular trading session, BA is currently trading at $127.79, up $3.10 or 2.49% on a volume of 2.19 million shares.