In a much-needed boost for Boeing, the IAG Group (owner of British Airways, Iberia) confirmed an order for 50 737 MAX aircraft, plus options.
Boeing has been attracting a lot of attention in the past few days and weeks, mostly for the wrong reasons. The manufacturer announced more delays for its 777X widebody. At the same time, the timeline for the restart of 787 deliveries remains unclear. Boeing’s military programs (including the next Air Force One) also continue to suffer from delays. And lastly, the manufacturer’s move of its headquarters to Washington DC didn’t impress many onlookers.
At the same time, some of Boeing’s existing customers seem set to switch to Airbus. And this is why this IAG order for the 737 MAX could be vital. IAG owns a number of European airlines. These include Ireland’s Aer Lingus, Spain’s Iberia, Vueling and Level and of course British Airways in the UK. And what all of these airlines have in common, is that their single-aisle fleets are all-Airbus.
The IAG 737 MAX Order: Two Variants
So one way or another, an IAG order for 50 737 MAX aircraft signals a departure for the group. British Airways has some Boeings: 777s and 787s. The last 737s in the group were some British Airways 737-400s, that went away in 2015. The group never got any 737NGs – with one briefly wet-leased 737-800 being the only exception.
So with this order, the IAG group goes from the 737 Classic to the MAX. More importantly, it will displace its Airbus fleet – at least in part. But as good as this news is for Boeing, it very nearly was much better. In 2019, IAG seemed set to order 200 737s, at a time when the MAX was still grounded. The events of 2020 derailed that plan.
With this in the background, the AIG order for “only” 50 737 MAX single aisles may seem small, by comparison. But the order also includes 100 options. The firm order is for 25 737-8-200s, i.e. a dense, 200-seat version of the 737-8, and 25 737-10s (230 seats). This is the latest and largest 737 MAX, which Boeing hopes to certify before the end of 2022. We don’t know if the 100 options are “locked” to a specific variant.
It is unclear which airline in the IAG Group is more likely to get these 737 MAX aircraft. The dense-configuration 737-8-200 suggests that a low-cost operator could get the jets. Vueling, for example, now operates 25 rather young A320neos and expects delivery of A321neos as well. But the arrival of the 737s could trigger a reshuffle of aircraft, throughout the group.
The next few months will be critical for the 737-10. Boeing needs to certify the jet before the end of the year or face the possibility of needing further modifications. Nevertheless, the IAG order for this 737 MAX variant shows that the airlines still have confidence in Boeing, despite its recent challenges. Lufthansa’s CEO Carsten Spohr added his voice to recent Boeing supporters. But he said that Boeing’s position means now is a good time for airlines to negotiate new orders.
This could be music to the ears of other airline bosses, waiting for the right time for their orders. But this strong position (for the airlines) might not apply to all aircraft types. Boeing’s delays currently affect its widebody offerings. But the manufacturer needs to show some more progress with its 737-7 and 737-10 programs over the next few months, to allay any fears of more delays.
Spyros Georgilidakis has degrees in Business Enterprise and Management. He has 14 years of experience in the hospitality and travel industries, along with a passion for all-things-aviation and travel logistics. He is also an experienced writer and editor for on-line publications, and a licensed professional drone pilot.