Monday 25 July 2016

Malaysia Airlines To Purchase Boeing 737 MAX

Malaysia Airlines signaled a possibility of acquiring Boeing units as part of its growth measure after the market opened on Monday.

According to the reports circulated in the media, the Malaysian Airline System Berhad will likely announce a plane order of Boeing B737 MAX later this week, Wednesday to be exact. The rumor came after the acquisition of Vietjet Air of 100 Boeing 737 MAXs, which cost $11.3 billion almost two months ago.

Prior to the report, Former MAS chief executive officer (CEO) Christoph Mueller has declared the intention of the company to purchase long-range narrow body aircraft in 2018 as it plan to expand its fleet probably in the sub-five hour routes in the Asian region.



Malaysia Airlines Chief Executive, Peter Bellew, admitted that the company was having a business negotiation with Bombardier, Airbus and Boeing. Mr. Bellew said ‘News should be confirmed next week…looking at new and second-hand lease or buying the aircraft.”

In-line with this, the airline firm may take an order of the new Airbus A321neo. Boeing’s B737 MAX and AirBus A321neo are among the long-range narrow body models available in the market.

On the other hand, Boeing hasn’t released an official statement regarding the possible order of Malaysian Airlines. Ken Morton, Boeing communications director, said that they do not want to comment or speculate on future sales or customer discussions in respect to the policy of the company.




Boeing and Airbus have been on strict competition among the aircraft manufacturers. Airbus generated 100 new orders of A3210 neo from Air Asia BHD, worth $12.6 billion. The two companies failed to accumulate a large number of orders at the at the Farnborough International Airshow compared to the past Airshow events.

At the same event, announced the recent upgrade of Boeing 737 Max. The narrow body jetliner will be stretched, whereas 12 more seats in two-class configuration will be added. If the plan of Boeing materializes, the company may acquire higher revenue.

Before the week ended, shares of Boeing lost 0.04 percent to $133.47 after opening much lower at $ 131.75. It had a price earnings ratio of 18.03 with a market capitalization of $84.98 billion. The stock has a dividend yield of 3.27 percent and its 50-day moving average was 130.44 while its 200-day moving average was 127.62.




The American airplane manufacturer has a 12-month low of 102.10 and a 12-month high of 150.59. Currently, the company operates under five segments namely Network & Space Systems, Boeing Capital, Global Services & Support, Defense, Space & Security and Commercial airplanes. Aircrafts which are sent to various airline industries are made under the Commercial Airplanes division.

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