Indonesia's Lion Air buying 50 Boeing 737's in US$6.2b deal

[JAKARTA] Indonesia's Lion Air is buying 50 Boeing 737 MAX 10 airplanes in a deal valued at about US$6.2 billion, the firms said Tuesday, as the carrier looks to cash in on a transport boom in the Southeast Asian nation.

The new single-aisle plane is the latest incarnation of Boeing's 737 MAX series, which can accommodate between 130 and 230 passengers and fly up to 7,130 kilometres, the companies said in a statement.

The order - the largest to date for the MAX 10 - was valued at US$6.24 billion, although multi-plane deals tend to end up costing carriers less than list prices.

The firms said the newest plane, which is to be delivered from 2020, "will be the most fuel-efficient and profitable single-aisle jet in the aviation industry".

"We signed this deal because we're anticipating a growing numbers of passengers in the coming years and so we can increase the amount of our national and international flights," Lion's president director Edward Sirait told AFP.

The low-cost carrier, which started less than 20 years ago with just one plane, stunned the sector in 2013 when it announced two of the world's largest aircraft orders in a monster US$46 billion deal.

At the time, Lion agreed to buy 234 medium-haul A320 jets worth some US$23.8 billion from European aerospace giant Airbus, after a US$22.4 billion deal for 230 Boeing planes.

Currently, the airline flies to nearly 80 mostly domestic destinations with international routes including Singapore, the Philippines, Malaysia, China, and Saudi Arabia.

Founded in 1999 by brothers Kusnan and Rusdi Kirana, Lion Air is the first private low-cost airline in Indonesia, a sprawling archipelago nation that has struggled with a spotty air safety record.

Some carriers, including Lion and national carrier Garuda, have on occasion been placed on travel blacklists over their lax safety standards.

With some 260 million people, Indonesia is the world's fourth most populous nation with more than 17,000 islands and is home to Southeast Asia's biggest economy.

The country has a burgeoning middle class which is keen to abandon travel by bus, ferry and train and instead take to the skies for holidays and family visits.

AFP