The Boeing Company
) secured an order from Canada's WestJet Airlines yesterday for
the supply of 65 new aircraft. The delivery of the planes is
expected to commence in Sep 2017 with production anticipated to
start in 2015. The order is for the company's new line of 737
aircraft and is worth $6.3 billion at current list prices.
Boeing will sell 40 737 MAX 8s and 25 737 MAX 7s. The line of
737 MAX is designed to suit all the requirements of an advanced
passenger carrier including efficiency, reliability and passenger
amenities. The final purchase deal is set to be concluded by Sep
The MAX 8 has the capacity to carry 162 to 175 passengers,
while the MAX 7 has room for 126 to 140 passengers. The narrow
body 737 MAX is expected to rival Airbus' A320neo carriers. The
latest incarnation of Boeing's 737 MAX is powered by CFM
International LEAP-1B engines which offer fuel cost savings of
13% from previous models.
WestJet has also revised its existing order of 15
Next-Generation 737 aircraft to 737 MAX aircraft due between Dec
2014 and 2018. The current addition will bring Boeing's total
deliveries to WestJet to 92.
Deliveries of Boeing's 737 will ramp up in 2013 backed by
rising airline activities in Asia, particularly in the Middle
East. The company picked up sizeable international
contracts from the Paris Air Show this year. The most notable
contract in Paris came from
Ryanair Holdings plc
) for the supply of 175 next generation 737-800 airplanes for
Boeing's technologically advanced commercial aircraft is in
demand in the domestic as well as international markets. This
will ensure a stable future earnings stream for Boeing's
Commercial Airplane Division. Commercial aircraft production for
top manufacturers is forecast to range between 27,350 and 34,000
in the next 20 years, which is a good sign for the company.
However, Boeing's defense opportunities might be hurt by
budget sequestration in the U.S. Currently, Boeing carries a
Zacks Rank #3 (Hold).
Meanwhile Zacks Ranked #2 (Buy) defense players looking good
at the moment are
Northrop Grumman Corp.
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