Boeing Set to Receive Record Order from Lion Air

Boeing Co.  (NYSE:BA) is anticipating an order of around 230 planes from Indonesian Airline carrier, Lion Air.

Boeing made the announcement on Thursday that it is set to receive an order of 230 jets. This will be the largest order that Boeing will ever receive from one carrier and the largest order given by any Indonesian carrier.

According to the Boeings list price, this order will set back Lion Air by $21.7 billion. However Boeing has not announced how much is it charging actually, since the carriers bargain and bring down the cost by a considerable percent.

According to Lion Air, it is planning to place an order of 29 extended range 737s and also 201 Boeing 737 Max planes. The extended range 737s are meant for long distance travel and the 737 Max planes are being upgraded to give more fuel efficiency.

The plans were announced by Lion Air during U.S. President Barack Obama’s ongoing trip to Indonesia for increasing business between the two countries. The two countries are aiming to increase trade between them and also increase cooperation in other areas.

The news of the order comes just a couple of days after a record order from Dubai based Emirates Airlines. Emirates Air placed an ordered, which based on list prices could be close to $18 billion. The order is for 50 Boeing 777s.

The Lion Air’s order is set to begin delivering from 2017. The rest of the terms of the contract are yet to be finalized. Lion Air also has plans for another 150 planes, which could add another $14 billion to the record price of the order, to close to $35 billion. Lion Air has only Boeing planes in its fleet and also has a pending order of 125 more 737-900 ERs.

American Airlines also announced its plans to order 460 planes to update its outdated planes, which pitted Boeing against its European rival Airbus. At that time American Airlines decided to buy 260 planes from Airbus and 200 planes from Boeing. Boeing sells its 737 planes more than any other model. The company is updating the engine of the plane to make it more fuel efficient.

If Lion Air finalizes its order, it will dwarf the previous largest order from United Airlines in 1989 for 115 planes. The stocks of Boeing Co. rose by 48 cents on the New York Stock Exchange in the morning trading after the announcement of the order.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.