Boeing has received a new order for 14 737 MAX aircraft from Dublin-headquartered lessor SMBC Aviation Capital. The lessor says it is growing its 737 MAX portfolio in preparation for a strong recovery in air travel following the COVID-19 pandemic.
The new order from the Japanese bank-backed lessor comes as airlines begin to modernize their narrowbody fleets with more fuel-efficient, less polluting planes. The addition of 14 new Boeing 737 MAX aircraft to SMBC Aviation Capital’s portfolio takes it to 121 Boeing 737 MAX jets.
SMBC is betting on a recovery
During the first quarter of 2021, SMBC Aviation Capital delivered 13 Boeing 737 MAX aircraft to its customers, with 11 going to Dallas-based Southwest Airlines, and two to British carrier TUI. TUI became the first European carrier to receive a Boeing 737 MAX after the long grounding of the type, when it took delivery of the two aircraft.
When speaking about the agreement to purchase 14 more Boeing 737 MAXs for its portfolio, SMBC Aviation Capital CEO Peter Barrett said:
“We are pleased to have concluded an agreement with Boeing for the purchase of 14 low-cost carrier configured 737 MAX aircraft, which is an aircraft we are seeing increased customer demand for following its successful return to service.”
US carriers have placed orders for the MAX
When speaking about the deal for the sale of 14 737 MAX aircraft to SMBC Aviation Capital, Boeing senior vice president of Commercial Sales and Marketing Ihssane Mounir said:
SMBC has been actively managing its portfolio in a very dynamic market. With this new order for the fuel-efficient 737-8, the lessor is well-positioned to help its customers capture domestic travel demand in several countries and regions,” adding “We are honored by SMBC’s trust in the 737 family, and we look forward to partnering with them to support airlines for the market recovery ahead.”
SMBC Aviation Capital’s decision to purchase the 14 new 737 MAX aircraft comes after recent commitments from Alaska Airlines, Southwest Airlines, and United Airlines.
- Alaska Airlines placed a firm order for 20 737 MAX 8s, 17 737 MAX 9s
- Southwest Airlines has placed a firm order for 100 Boeing 737 MAX 7s
- United Airlines placed a firm order for 100 737 MAX 9s
SMBC Aviation Capital’s purchase of 14 Boeing 737 MAX aircraft takes Boeing’s total order’s for its 737 MAX aircraft to just over 250 jets in 2021.
About SMBC Aviation Capital
SMBC Aviation Capital is one of the worlds largest aircraft leasing companies and is owned by a consortium of Japanese institutions, which include:
- Sumitomo Mitsui Banking Corporation (SMBC)
- Sumitomo Mitsui Finance and Leasing Company Limited (SMFL)
- Sumitomo Corporation
The company is headquartered in Dublin, Ireland, and has offices in Amsterdam, Beijing, Hong Kong, Kyiv, Moscow, New York, Seattle, Miami, Shanghai, Singapore, Tokyo, and Toulouse. SMBC Aviation Capital leases aircraft to 85 customers in 36 countries. As of March 31, 2021, SMBC Aviation Capital’s aircraft portfolio contained the following planes:
- 270 Airbus A320neos
- 107 Boeing 737 MAXs
- 31 Boeing 787-8/9s
- 11 Airbus A350s
Boeing intends to ramp up MAX production
Boeing halted production of the 737 MAX, its fastest-selling model, in 2019 following two fatal crashes. When production resumed last May, it was at a fraction of the pace due to regulatory approvals and a supply chain impacted by COVID-19. Now, Boeing intends to speed up the production of the 737 MAX and hopes to be building around 42 planes a month by the third quarter of 2022.
As for SMBC Aviation Capital, they are betting on strong demand for new aircraft as airlines focus on repairing their balance sheets following COVID-19. The order for the new MAX aircraft is not only a shot in the arm for Boeing but good news all around if the recovery in air travel is as strong as SMBC Aviation Capital thinks it will be.