International aircraft leasing company Avolon has committed to an order of 40 Boeing 737 MAX aircraft. The aircraft are scheduled for delivery between 2027 and 2030, and the bulk purchase is valued at over $4 billion at current list price.
One thousand 737 MAX deliveries
Avolon delivered the first 737 MAX in 2017, along with the one thousandth 737 MAX earlier this year. This commitment builds on our strong relationship with Boeing and demonstrates our confidence in the long-term demand for this aircraft type.
It will increase the overall size of Avolon’s owned, managed and committed fleet to 870 aircraft.
The 737 MAX provides Avolon’s customers with greater flexibility across their networks, while reducing fuel use and emissions by up to 20% compared to the aircraft they will replace.
This commitment reinforces the leasing company’s moves towards increasing the proportion of new technology fuel-efficient aircraft in its fleet.
This efficiency is supported by the 737 MAX’s use of the latest CFM International LEAP-1B engines and advanced technology drag reducing winglets.
Speaking on the new bulk order, Andy Cronin, CEO of Avolon, commented: “This commitment with Boeing underlines our confidence in the positive momentum in the aviation market, and increases our portfolio of young, modern, fuel-efficient aircraft.”
“With strong demand for our new technology orderbook, and delivery slots at a premium, it strengthens and extends our delivery profile with Boeing.”
“This commitment will also support our airline customers who are looking to plan beyond the robust post-Covid traffic recovery and prepare for future growth, while also reducing their carbon emissions.”
The transaction is subject only to approval by shareholders of Bohai Leasing Co., Ltd., Avolon’s 70% shareholder, which is anticipated before the end of May.
Boeing ramp up production
The announcement of the internationally leasing company’s 40 strong order follows news that aircraft manufacturer Boeing intends to ramp up its monthly output of 737 aircraft this year.
Yesterday Boeing released its quarter one 2023 performance figures which relevantly states the manufacturers expectation of a delivery of between 400 and 450 aircraft from its 737 programme this year alone.
The manufacturer plans to increase output on the 737 to 38 per month later this year, which will further increase to 50 per month in the 2025/2026 timeframe.
Earlier this month, the 737 program’s fuselage supplier notified Boeing that a non-standard manufacturing process was used on two fittings in the aft fuselage section of certain 737 airplanes.
Boeing stated that this issue may affect near-term deliveries and production would be impacted in the short term only.
It expects final assembly production to recover in the coming months, with a subsequent planned ramp up of output.
Boeing plans to increase output on the 737 to 38 per month later this year, which will further increase to 50 per month in the 2025/2026 timeframe.
Headquartered in Ireland, with offices in the United States, Dubai, Singapore and Hong Kong, Avolon provides aircraft leasing and lease management services.
Avolon is 70% owned by an indirect subsidiary of Bohai Leasing Co., Ltd., a public company listed on the Shenzhen Stock Exchange and 30% owned by ORIX Aviation Systems Limited, a subsidiary of ORIX Corporation which is listed on the Tokyo and New York Stock Exchanges.
Avolon is a global leader in aircraft leasing with an owned, managed and committed fleet, as of 31 March 2023 of 830 aircraft