Boeing wins Malaysia Airlines order for 25 new aircraft

Boeing will deliver 25 B737 Max aircraft (pictured) to Malaysia Airlines from 2019.
Boeing will deliver 25 B737 Max aircraft (pictured) to Malaysia Airlines from 2019. PHOTO: AFP

KUALA LUMPUR (BLOOMBERG) - Boeing won an order for 25 B737 Max jets from Malaysia Airlines as the flag carrier expands its fleet for the first time since two fatal air crashes in 2014 prompted the government to take over the company.

Deliveries from the Chicago-based manufacturer are set to start in 2019, and the operator has options for 25 more of the aircraft, the airline said in a statement.

The addition to its fleet may help Malaysia Airlines, which is in the midst of a 6 billion-ringgit (S$2.03 billion) business overhaul, compete against a slew of budget carriers in the region. Passenger confidence in the carrier, now fully owned by sovereign wealth fund Khazanah Nasional, took a dive two years ago after Flight MH370 vanished on March 8, 2014 and another was shot down over Ukraine four months later.

The airline this month named Mr Peter Bellew as chief executive officer, its third in two years, adding the appointment will ensure continuity in the execution of the turnaround plan. The Asian carrier is ahead of schedule with its restructuring, having reached break even recently, putting it on course for a full-year profit in 2018 as targeted, if not earlier, former CEO Christoph Mueller said in a June interview.

This month, Boeing raised its long-term forecast for aircraft orders, saying the rise of discount carriers and growth in developing countries will fuel purchases despite recent economic turmoil from Brexit and a commodities slump. Airlines worldwide will order new planes valued at US$5.9 trillion (S$8 trillion) over the next two decades, it said on July 11, up 4.1 per cent from a year earlier. That would represent a total of 39,620 jetliners across the industry.