Lion Air Confirms $6.2b Deal for Boeing 737s, Flags 787 Jet Order

Lion Air announced a firm order on Tuesday (10/04) for the purchase of 50 Boeing 737 MAX 10 narrowbody jets worth $6.24 billion and said it plans to place a provisional order for Boeing 787 widebody jets in the next few weeks. (Reuters Photo/Darren Whiteside)

By : Cindy Silviana & Bernadette Christina Munthe | on 7:45 PM April 10, 2018
Category : Business, Corporate News

Jakarta. Indonesia's Lion Air Group announced a firm order on Tuesday (10/04) for the purchase of 50 Boeing 737 MAX 10 narrowbody jets worth $6.24 billion and said it plans to place a provisional order for Boeing 787 widebody jets in the next few weeks.

The low-cost carrier, which already has offshoots in Malaysia and Thailand, also plans to establish a new airline in a Southeast Asian country this year, co-founder Rusdi Kirana told reporters.

He declined to elaborate on the number of 787s to be ordered or in which country the new airline would be established.

A memorandum of understanding for the purchase of 787s would be announced in "two to three weeks," he said.

His comments came after the privately owned company earlier in the day confirmed the purchase of the 50 Boeing 737 MAX 10 jets by announcing a firm order. The jets are worth $6.24 billion at list prices, but airlines usually get discounts for bulk purchases.

The rapidly expanding carrier had placed a provisional order in June 2017 for the jets – the newest and largest member of the Boeing narrowbody family.

Rusdi said the Indonesian government's infrastructure expansion, which includes airports, is fueling Lion Air's demand for more aircraft.

The airline's fleet is comprised primarily of narrowbodies, although it has three Airbus SE A330 widebodies. Rusdi did not say on what routes the 787s would be used.

Dinesh Keskar, Boeing senior vice president Asia-Pacific and India sales, said regulators are due to certify the Boeing 737 MAX 10 in 2020, with Lion Air expected to receive its first jets of the type soon after.

Boeing said it had been listing this deal as from an unidentified customer in its order book before Lion Air's confirmation.

Lion Air, one of Boeing's largest customers, was the first airline globally to take delivery of the smaller Boeing 737 MAX 9 earlier this year.

Local media reported in 2016 that Lion Air was looking to set up a new airline with a Vietnamese partner. Rusdi declined to comment on whether that was the Southeast Asian market Lion Air was targeting for entry this year.

Reuters

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