The Boeing Company
) announced it received a commitment from Swiss International Air
Lines (SWISS) for the purchase of six 777-300ER (Extended Range)
airplanes. The cost of the airplanes will be $1.9 billion at
current list prices. SWISS is a part of the Lufthansa Group.
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The 777 -300 ER model is preferred by airline operators due to
its capability to fly long distances with more than 350
passengers. This aircraft is 18%-20% more fuel efficient than
other rival models in this range. The spacious interiors of the
airplanes increase the comfort level of the passengers. The
maximum flying range of the aircraft is 7,825 nautical miles
(14,490 km). These very features would help SWISS to retain its
competitive edge over other airliners which operate airplanes
with more than 300 seats on similar routes.
The gradual recovery in the global economy is bringing in a
steady improvement in passenger and freight traffic. As per the
International Air Transport Association (IATA), global airline
passengers will touch 3.6 billion in 2016, expanding 5.3% per
annum in the period 2012 to 2016.
This is amply reflected in the order book of Boeing. The company
was able to secure net bookings for 805 airplanes in 2011, which
jumped to 1,203 airplanes in 2012. Fresh bookings continue to
trickle in this year. Till Mar 12, 2013, Boeing received net
orders for 191 airplanes, out of which 11 were for the 777
variant. The 737 model has won the most bookings to date with 138
Recently Boeing was able to secure a $4 billion order for its
United Continental Holdings Inc.
) ordered eight 737-900ERs, Qantas ordered five aircrafts and
leasing company GECAS ordered for another four airplanes. On the
other hand, 10 big 777 airplanes have been ordered by
Air Lease Corp.
Despite a busy order book, Boeing is yet to resolve the battery
related problems of its 787 model. Though the company has
received regulatory nod to carry on testing of new batteries, it
is still uncertain when this technologically sound airplane will
resume commercial operation.
Apart from the commercial airspace, Boeing is also one of the
leading players in the U.S. Aerospace and Defense sector. The
uncertainty prevailing over the U.S. defense budget and
sequestration might impact the defense revenue of the company.
Boeing and its aerospace peer
Lockheed Martin Corporation
) currently retain a Zacks Rank # 2 (Buy).