The Zhitong Finance App learned that Boeing (BA.US) has secured two consecutive orders at the Farnborough International Air Show in the UK. One of the major orders came from aircraft leasing company SMBC Aviation Capital, which were the first major high-profile deals at this air show, and the other came from Philippine Airlines. As of press release, US stocks of Boeing rose more than 1% in the premarket on Monday.
The air show is usually the main occasion for Airbus and Boeing to obtain procurement commitments for large aircraft and then officially announce the order at the signing ceremony. This year's Farnborough Air Show was held alternately with the Paris Air Show, providing Boeing with an opportunity to expand its trading activities. Previously, the US aircraft manufacturer was absent from the previous event due to an aircraft accident that occurred a few days before last year's air show.
SMBC announced on Monday that it will buy 100 737 Max aircraft, including 60 larger Max 10 models and 40 Max 8 models. Aircraft leasing companies have become an increasingly important customer group for Airbus and Boeing. The leasing model allows airlines to flexibly modernize their fleets without having to buy expensive aircraft directly. In commercial aviation, single-aisle aircraft such as the 737 and A320 are the most widely used models, so they are also the most mobile and popular models in the aircraft leasing industry. After completing the acquisition of US aircraft leasing company Air Lease this year, SMBC further strengthened its position as the world's second-largest aircraft lessor, after AerCap.
Boeing's second order comes from Philippine Airlines, which will be the first time the Southeast Asian airline has purchased a Boeing aircraft in nearly 20 years. According to reports, the airline has agreed to purchase up to 20 787-10 “Dreamliner”, and delivery of the relevant aircraft is expected to begin in 2031. According to an announcement issued by Philippine Airlines, the memorandum of understanding includes a firm order for 15 787-10 aircraft, with options for an additional 5 aircraft.
While boosting Boeing's performance, this order from Philippine Airlines also helps ensure that US-made aircraft continue to maintain their share in a market dominated by Airbus. As of the end of last year, the company's fleet size was 82 aircraft, according to Philippine Airlines's annual report. These include 10 Boeing 777s for long-haul routes, and 4 Airbus A350 long-range airliners, in addition to 11 Airbus A330 aircraft used for route operations in the Asia-Pacific region.
In addition to orders, Boeing's expansion of production capacity also ushered in a key turning point. Following the near-catastrophic accident of a 737 Max aircraft in 2024, regulators discovered that Boeing had a range of quality issues. Subsequently, the US Federal Aviation Administration (FAA) restricted Boeing's aircraft production and removed the company's authority to execute the final licensing agreement on newly produced aircraft.
However, this permission will soon be restored. The FAA said that the decision to restore Boeing's relevant authority will officially take effect on July 20, reflecting the company's progress in improving quality management and regaining the trust of regulators. Meanwhile, the FAA said that regulators will continue to monitor the aircraft manufacturer's quality level.
This is critical for Boeing to scale up production, improve its financial position, and regain an edge in competition with rival Airbus. Currently, the US aircraft manufacturer is working to stabilize the production of its “Cash Cow” 737 series aircraft. The goal is to maintain monthly production at 47 aircraft, and plans to gradually increase it to 63 aircraft over the next few years.
Earlier this month, Boeing officially opened its fourth 737 Max assembly line near Seattle to deliver its growing backlog of orders, although initial production at the new line will be relatively low. This new production line is a key part of Boeing's increase in production of the 737 MAX series. Boeing senior executive Jennifer Borand-Masterson said at the time that Boeing will use a low-speed production model at this stage to investigate and resolve various hidden production hazards and ensure the smooth operation of production lines. She did not reveal the specific pace of expansion of this production line, but said that in the future, the recruitment of workers will be gradually expanded as production capacity increases.
US regulators are also expected to approve the latest model in the 737 Max series within the next few months. Although Rocello said he was unable to give a specific certification schedule for the 737 Max 7 and Max 10 models, he said Boeing was “getting closer day by day” to approval. He noted that the certification of the 737 Max 7 is “very close to completion.”