IAG signs deal to buy 200 Boeing 737 Max planes for $24bln
JOHANNESBURG - International Airlines Group (IAG), one of the world's largest airline groups, announced on Wednesday it plans to build its future fleet with the Boeing 737 MAX with an intention to purchase 200 MAX jets.
US manufacturer Boeing has faced a backlash in recent months after airlines around the world grounded its fleets of 737 Max 8 jets in the wake of two fatal crashes within five months. There where 157 lives lost in Ethiopia in March and 189 were killed in Indonesia in October 2018.
Boeing has had to update the software for its 737 Max aircraft and conduct a number of tests before receiving regulatory approvals to fly again.
In a statement, IAG and Boeing said the two companies have been in discussions regarding the opportunity and signed a letter of intent at the Paris Air Show in a deal that would be valued at more than U.S.$24 billion, per list prices.
IAG is the parent company of Aer Lingus, British Airways, Iberia, Vueling and LEVEL that fly more than 113 million passengers a year combined.
The group has been a long-time operator of Boeing twin-aisle airplanes. Earlier this year, IAG group committed to and finalised a major order for Boeing's newest long-haul model, the 777X, to complement its fleet of current-generation 777s and new 787 Dreamliners.
In the single-aisle segment, IAG and its affiliates used to operate Classic 737 aircraft but today its fleet is almost exclusively Airbus A320 family aircraft.
Willie Walsh, IAG chief executive, said the group would consider the 737 MAX as part of diversifying its future fleet to spur competition.
"We're very pleased to sign this letter of intent with Boeing and are certain that these aircraft will be a great addition to IAG's short-haul fleet," Walsh said.
"We have every confidence in Boeing and expect that the aircraft will make a successful return to service in the coming months having received approval from the regulators."
In selecting the 737 MAX, IAG said it will fly a combination of the 737 MAX 8, which seats up to 178 passengers in a two-class configuration, and the larger 737 MAX 10 jet, which can accommodate as many as 230 passengers.
The airline did not disclose a specific split between the two MAX models, though it anticipates deploying the aircraft at a number of the group's airlines including Vueling and LEVEL.
Kevin McAllister, president and chief executive of Boeing commercial airplanes, said they were honored and humbled by the leadership at InAG for placing their trust and confidence in the 737 MAX.
"We are delighted that the IAG team recognised the superior qualities of the 737 MAX and has indicated an intention to return to the Boeing 737 family. We look forward to building on our long-standing partnership with IAG for many years to come," McAllister said.
- African News Agency (ANA)