Boeing Adds Another Big Order

Boeing Co. (NYSE: BA) announced another big order for its 737 MAX aircraft. The airplane leasing division of General Electric Co. (NYSE: GE) has ordered 75 of the 737 MAX 8 aircraft and 25 of Boeing’s Next-Generation 737-800s. The deal is valued at $9.2 billion at list prices for the planes and is larger than the $7.9 billion order Boeing announced yesterday from Air Lease Corp. (NYSE: AL).

Boeing also reported that it has taken an order for 10 737 MAX 8s from a Kuwaiti leasing company. At list price, the order is worth $1.9 billion.

Boeing rival Airbus, officially the European Aeronautic Defense and Space Co. (OTC: EADSY) also announced its first order during the Farnborough Air Show near London. Hong Kong-based Cathay Pacific has ordered 10 new Airbus A350-1000s and replaced a previous order for 16 of an earlier version of the plane with the new version. The value of the order at list price is $4.2 billion.

Canadian-based aircraft maker Bombardier Inc. (OTC: BDRAF) announced an order for 10 of its commuter jets and rights to purchase another 10 from Latvia-based airBaltic. The total value of the deal for all 20 planes is $1.57 billion.

The new orders are a bit difficult to square with the faltering global economy until your remember than most of these orders won’t be filled for several years. Boeing’s delivery of the 737 MAX family of planes is not expected until 2017. The two orders that Boeing has announced this week have come from leasing companies, not airlines. That could indicate that rather than purchasing new aircraft in the face of the uncertain economy, some carriers might be willing to lease planes from GE or Air Lease. Or it could mean that the leasing companies expect a larger number of very rich people to lease big jets over the next few years.

Boeing’s shares are up about 0.8% at noon today, at $74.63 ina 52-week range of $56.01-$77.83.

Paul Ausick

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