The deal will be valued at $4.6 billion at list prices once all contingencies are cleared. The deliveries are expected to be between 2017 and 2019.
Last year, Boeing won an order from China Eastern for 80 737 jets valued at $7.4 billion. The unprecedented rise in passenger traffic in the Asia-Pacific region is bringing in a steady flow of orders.
The 737 family of airplanes is witnessing a sharp rise in demand in the commercial aircraft market, primarily in China, India, the Middle East and Africa, and other emerging countries due to the growing popularity of the low-cost carrier business.
In May 2015, Boeing nabbed a $6.1 billion order from a Chinese consortium for its single-aisle 737 Max jets. Chinese carrier Ruili Airlines and two leasing companies − AVIC International Leasing Co Ltd and Minsheng Financial Leasing Co Ltd − have a deal with the aerospace behemoth for 60 narrow-bodied 737 Max models.
Boeing, in its recently released market outlook, stated that the world will need 38,050 new planes worth $5.6 trillion between 2015 and 2034 against 36,770 predicted last year. Single-aisle, narrow body jets like Next-Generation 737-800, new 737 MAX 8 and Airbus' A320 will account for 26,730 jets worth $2.7 trillion in the next 20 years, comprising 70% of the total units forecast.
About 40% of the total commercial demand is likely to come from the Asian markets, another 40% from Europe and North America, and the balance from the rest of the world.
Recently, Boeing released its second quarter 2015 delivery numbers. The company delivered 381 commercial jetliners in the first half of the year, increasing 11.4% year over year and beating its archrival Airbus.
Boeing is faring much better this year than the last, when the stock had faltered on the bourses. The company’s new 737 Max model has drawn much interest while the 787 Dreamliner continues to do well.
(Zacks - Zacks Equity Research / Yahoo Financial News)