In the last few days we saw a few more orders and commitments for the A320neo and B737 MAX. Here is a list:

50 Qatar (+30 options)
50 ALAFCO (+30 options)
30 ACG
45 Spirit Airlines
30 Volaris

B737 MAX:
201 Lion Air (+150 options)
35 ACG

So we now know three committed customers for the B737 MAX out of the nine customers that committed for 700 aircraft - the third one of course being American Airlines, triggering the launch of the B737 MAX with their rejection of the also proposed Boeing NSA and their commitment to take 100 B737 MAX and an option for another 60.
The Lion Air commitment is significant:
  • Furthermost of course due to size. 201 - that is one more than the AirAsia contract for 200 A320neo's. Just to show who will eventually get larger...?
  • It's not in said in the statement, but obviously Lion Air wants the -9 version of the B737 MAX. A clue for this is the given list price for the whole contract, which puts the price for a single aircraft to $95 million. Lion Air was also the launch customer for the B737-900ER and still has 114 on order - as well as 12 B737-800. Originally these were also -900ER orders, but Lion Air switched these to the -800 just this year, stating the better residual value of the -800 as a reason.
Aside from the commitment for the 201 B737 MAX, Lion Air wants another 29 B737-900ER's, so the outstanding orders for B737NG's would be 114+12+29=155.
In 2010 Boeing delivered 13 B737-900 to Lion Air, this year also 13 until October and we can expect 2 or 3 more until the end of the year.
Delivery rates of 15-16 aircraft a year would suggest that the latest B737NG would delivered in about 10 years from now - towards the end of 2021. Is that the time Lion Air expects to take their first B737 MAX? Why then order/commit now?
Sure - it could be that they are taking more aircraft per year. This Wikipedia article states that 144 NG's will be delivered between 2011 and 2014. This would leave some 130 aircraft in 2012-2014 - 43 aircraft per year! But can they finance them? Are their enough routes to open every year? How can they manage such an expansion? They already have the worst On Time Performance of all indonesion carriers, so they temporarily had to ground 13 aircraft (see also Wikipedia article). Their safety record is not the best, to be polite. Lion Air is on the "black list" of the European Union as their maintenance practices are seen as inadequate.
Lion Air also tried to establish JV's - until now that did not work.
So I can't really see how they can absorb so many aircraft, even if they sell older aircraft before they require heavy maintenance, as Ryanair and the likes do. But flooding the market with -900ER's will not be good for resale values longterm.

Lion Air is privately owned, so we do not get any information about the financial situation of the airline. But obviously the airline is making money, as I cannot imagine that anybody would throw good money after bad one...well, but that has often be said on other occasions also and was not true.

But one thing is certain: President Obama made a good job, harmonizing that MoU (or whatever this "commitment" is) with his visit to Indonesia. 110.000 american jobs - that's an argument!

Besides that, this huge order is somewhat irritating...

Back to neo:
The A320neo collected a few more orders and commitments. Qatar's order for 50 A320neo wa long rumored, but a real new one. ALAFCO, after signing a MoU for 30 aircraft at the Paris Air Show, now signed a firm order for 50 aircraft and wants to firm another 30 until the end of the year - now that is confidence...
With ACG there is another leasing company in the neo clubhouse, signing for 30 aircraft.
Then two low cost carrier came to the plate: Spirit Airlines and Volaris, signing MoU's for both "classic" A320's and A320neo's. There are a few things both have in common:
  • Both are current A320 users.
  • Both have the V2500 on their current aircraft.
  • Both have a common major shareholder named Indigo Partners. This US firm is led by former America West CEO Bill Franke
After the PW1100G-Jm got orders for the 50 A320neo from Qatar as, somewhat surprisingly, for the whole batch of the (initial) ALAFCO order (lessors normally split their engine orders at the A320 family), here are, I think, another good chances to get business for IAE as well as the new Pratt led consortia for the PW1100G-JM.
Not to forget: CFM also got another customer for the LEAP-1A. Garuda opted to take the engine for their 10 A320neo on order for Citilink.


  1. Aviation Capital Group is #10 for Max. See http://wp.me/pcvQh-1oU

  2. When you say "the rejection of the NSA" was that really a rejection? I mean, would you reject something that is significant better than what you have now. That is kind of a weird way of putting it. Was it perhaps that AA did not want to wait as long to get the NSA? So I don't understand how that could be a rejection of something you can have yet. I suppose you are rejecting the future model cars because you need one now, right?

  3. First delivery of the B737MAX to AA will happen in 2018 IIRC -pending the outcome of chapter 11 process. EIS of the NSA was planned in 2019, just one year later. So AA could have chosen to take a few more neo's in that year to bridge the gap. But obviously (to me) the risk of a brand new airplane (aka to have a 787 deja vu) was a big factor to press Boeing to develop the lower risk B737MAX.

  4. Ok, even if that was the case, AA could still order more A320 and not even bother with the B737 MAX if they would get something so much better in a couple of years (by the way, AA also ordered more 737NG just to show how quickly they need these aircrafts). Plus, the 2019 entry into service was just thrown out there as a starting point. I do not think that Boeing would had agreed to that entry into service year for a new airplane after seeing how hard it was for them to get the B787 certified. That's one of the reason why they're putting the delivery dates of the MAX in 2017 when they could have it done sooner than that if they wanted. After all, the bigger concern would be the engine which would be available way before 2017. That is unless CFM is planning something totally different with the Leap-X for the MAX.

  5. "Ok, even if that was the case, AA could still order more A320..."
    Exactly as I said before!
    "Plus, the 2019 entry into service was just thrown out there as a starting point."
    "...delivery dates of the MAX in 2017 when they could have it done sooner than that if they wanted. After all, the bigger concern would be the engine which would be available way before 2017."
    I doubt that heavily! It's not even said that the LEAP-1A will be ready in 2016 and the LEAP-1B is different (complete new low spool and "optmized" core), so the engine is probably indeed the concern!

  6. Airbus said the A320neo was the fastest selling plane.
    Now, it has been a little more than 100 days since the launch of the 737MAX and it has attracted +- 800 orders. The A320neo attracted about 300 orders in its first 100 days, now which one is the fastest selling plane in history?

  7. Hi~ I am interested in commercial aircarft industry. Your blog helps me to access the information of the 737MAX. Thank you.

    I would like to ask a question, which might be very basic but not for me. Actually I'm just a starter of this industry.

    The Lion Air's Order book of MAX in your blogs says as below;

    firm/firm total/Status/options/total options



    What is difference between options(150) and total options(250)?

    Thank you in advance for your reply. ^^

  8. This comment has been removed by the author.

  9. Options means the optioen of the particular airline of this line. Total options is the total number options of all customers up to this line...