BA owner to buy 200 Boeing 737 Max jets
British Airways owner IAG is set to order 200 of the currently grounded Boeing 737 Max aeroplanes.
The airline group signed a letter of intent at the Paris Air Show and said it was confident that the Boeing planes would return to service in the coming months.
The 737 Max was grounded across the world in March 2019 after 346 people died in two separate crashes.
The order will come as a huge boost for Boeing, whose prospects seemed at an all-time low in recent months.
Boeing is currently trying to develop a software fix for the planes and thanked IAG for their “trust and confidence” in the 737 Max.
At list prices, 200 737 Max jets would cost around $24 billion (£19 billion), but industry experts have suggested that IAG, which also owns Aer Lingus and Iberia, could have negotiated a sizeable discount.
It’s still possible that IAG could change its mind over the order, but shares in Boeing rose more than 2.8 per cent following the announcement.
In October 2018, 189 people died in the Lion Air disaster in Indonesia. In March, an Ethiopian Airlines flight crashed, killing 157 people on board.
Investigators suspect that a failure in the 737 Max’s anti-stall system MCAS may have played a role in bringing the planes down.
It’s unclear when the 737 Max grounding order will be lifted and when it will return to service.
The chief of the US aviation regulator said this week that the planes could be grounded until the end of the year.
Boeing reportedly has a backlog of nearly 5,000 737 Max’s on order, making it the manufacturers best selling jet.
Willie Walsh, IAG’s chief executive, said: "We have every confidence in Boeing and expect that the aircraft will make a successful return to service in the coming months having received approval from the regulators.”