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Malaysia Airlines to buy 50 Boeing 737 MAX jets

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27 July 2016

Malaysia Airlines said today that it had ordered 50 Boeing 737 MAX jets, with firm orders for 25 and rights to purchase another 25, in deal worth $5.5 billion at list prices, according to a statement of the full-service carrier.

Airlines are typically offered a discount off the list prices.

Deliveries are scheduled to start in 2019.

The 737 Max, which is the reengined and upgraded variant of Boeing's popular narrow-body model, will cut costs with its longer range. The carrier would also be able to fly to more destinations, according to chief executive Peter Bellew.

This comes as the first major decision by the ailing carrier since Bellew took over from former chief executive Christoph Mueller on 1 July.

The new planes would replace some of the airline's 56 Boeing 737-800s, which had an average age of 4.1 years according to airfleets.net.

Malaysia Airlines had been badly hit by the disappearance of flight MH370 and shooting down of flight MH17 over eastern Ukraine, both in 2014.

The twin disasters led to the cancellation of all non-stop flights to Europe except those to London. Several low-yield Asia-Pacific services were also terminated.

The ailing national carrier was taken private by state-fund Khazanah Nasional Bhd after the disasters under a restructuring plan, which included a shrinking of its network.

Bellew said the purchase of the aircraft, which were known for their fuel efficiency, would aid the airline's recovery.

"This deal is a game-changer for Malaysia Airlines with much lower costs and greater efficiency which we will pass on to our loyal customers with lower fares," Bellew said in announcing the deal.

Malaysia Airlines currently operates 56 Boeing 737-800s as also smaller numbers of Airbus aircraft.

In the aftermath of the twin disasters, Mueller launched a drastic rescue plan cutting 6,000 jobs and dramatically trimming the route network.

However, in an abrupt move, he annouced in April that he would be leaving well before the end of his three-year contract for unspecified "personal reasons".





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