Southwest Airlines has just placed the largest aircraft order in Boeing history, ordering 58 737NG aircraft and becoming the launch customer for the 737Max, with 150 firm orders. Southwest, which was also launch customer for the 737-300, 737-500, and 737-700, will be the first to take delivery of the 737Max powered by the CFM Leap-1B engines.
The combined order is valued at more than $19 billion at list prices, although our sources indicate that pricing is closer to $10 billion given the substantial discount provide to Southwest, which will remain the largest single customer for the 737 and remains an all-Boeing customer.
The order for new aircraft from Boeing comes after considerable pressure from Southwest and other customers to deliver more fuel efficient aircraft in the wake of recent fuel price increases. Boeing indicates that the max will be 10-12% more fuel efficient than current models, and claims “lowest operating costs in the single aisle segment by 7% over tomorrow’s competition”, although we would take that claim with a grain of salt, as our independent analyses show a different conclusion.
Gary Kelly, in announcing the order, stated “Today’s environment demands that we become more fuel efficient and environmentally friendly, and as the launch customer of the Boeing 737 MAX, we have accomplished both.”
To date, including the Southwest orders, the 737 MAX has 150 firm orders and more than 750 additional commitments from 13 customers.