Malaysia Airlines Announces Purchase Of 50 Boeing Co (NYSE:BA) 737 MAX

Malaysia Airlines announced on Wednesday that it would buy 50 units of Boeing Co (NYSE:BA) 737 MAX aircraft in its bid to make a comeback from the 2014 twin disasters that left it in shambles. The purchase will cost the national carrier $5.5 billion and delivery of the aircrafts will begin in 2019.

The Borneo Post reported that 25 firm orders for the Boeing 737 MAX had already been placed and purchase rights for 25 more had been acquired. Malaysia Airlines’ new CEO Peter Bellew said the fuel efficient aircrafts would boost the airlines in its recovery.

Bellew said in the announcement, “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.”

56 Boeing 737-800 aircrafts are already flying for Malaysia Airlines. It also uses some Airbus aircrafts though in lesser numbers.

Malaysia Airlines had been taken off Bursa Malaysia after a privatization exercise for restructuring it was carried out by KhazanahNasional in the wake of the 2014 tragedies. One of the airlines’ flights, MH370, had disappeared while MH17 had been shot down.

According to The Sun Daily, Bellew said, “The Olympics for us is to try get a listing in place, depending on where the overall international capital markets go. If you work back five quarters, we would be profitable through 2018 so we have lots of work to do to make sure Malaysia Airlines gets back on track.”

The Boeing 737 MAX aircraft are expected to bring down the airlines’ operating costs. They have 12% more seats than Malaysia Airlines’ existing fleet and consume 15% less fuel. The aircraft operation costs 40% less per month.

The plan for Malaysia Airlines is to use the new aircraft for catering to growing markets in China, India, Pakistan and North Asia.

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