Leading commercial airplane producer,
The Boeing Co.
) received another multi billion order for its 737 model from
Alaska Airlines. Per the order, Boeing will supply 50' 737 airlines
at list prices taking the deal value to $5 billion.
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Out of the total airplanes ordered, 37 of them will be 737 MAX.
Alaska Airlines is sure to get a discount on the list prices, as is
the custom offered by Boeing on bulk orders.
The Boeing 737 MAX sees brisk demand in the single-aisle market for
its fuel efficiency and low carbon dioxide emissions. Powered by
the Commercial Fan Motor ("CFM") International LEAP-1B engines, the
Advanced Technology winglet of this airplane also enhances
Additionally, the pivoting overhead stowage bins add to the
spaciousness of the cabin. The bins give passengers more room to
keep a carry-on roll-aboard near their own seat besides providing
extra leg space. At the end, the 737 MAX is expected to incur the
least operating cost in the single-aisle category.
The 737 variant is one of the best selling aircraft models for
Boeing and contributes a major chunk of the commercial airplane
revenue of the company. Till October 10, 2012, the company received
net orders for 910 airplanes of different variants of 737.
Boeing received another big order for the 737 model last month from
Avolon. The order for 25 airplanes included 10' 737 MAX 8s, 5' 737
MAX 9s and 10' Next-Generation 737-800s. The total value of the
order at list prices is pegged at $2.4 billion.
Boeing 737 continues to be a major contributor to Boeing's
Commercial Airplanes segment. Net orders of 910 airplanes out of a
total 929 are a sufficient testament to the fact.
We also believe that Boeing is on course to meet its delivery goal
of 585 to 600 airplanes in 2012. Till September 2012, the company
delivered 436 airplanes including 310 '737 variant. However, we
believe the delay in delivery of the 787 Dreamliner might impact
the total delivery target of the company.
Boeing Co. retains a Zacks #3 Rank (Hold rating). Boeing's peers,
across diverse niches, are
General Dynamics Corp.
Lockheed Martin Corporation
Northrop Grumman Corporation
Chicago-based, Boeing is a major operator in both commercial
airline and defense sectors. Its global customer base includes
individuals, organizations and governments. With a market
capitalization of $53.25 billion, the company has 171,700 full time