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Massive 737 order could signal Aussie ambition for Lion Air

written by australianaviation.com.au | November 18, 2011
Boeing and Indonesia's Lion Air have announced a record $21.7b deal for 240 737s.

A record buy of Boeing 737s by Lion Air signals an expansion that could see the Indonesian carrier enter the Australian market.

Boeing and the airline confirmed Thursday a $21.7 billion commitment for 201 737 MAX and 29 737-900ER jetliners. The deal broke a Boeing record for both volume and value, topping a days old mark  set by Emirates Airlines’ $18 billion deal for 50 777-300ERs.

Lion Air, which currently operates a fleet of 67 aircraft, has long held an interest in the Australian market. The carrier announced plans in 2008 to launch an Australian based domestic and international carrier as part of a joint venture with SkyAirWorld. That plan fell through when SkyAirWorld collapsed the following year, but Indonesian media reports last year indicated that Lion Air was again contemplating the launch of international service to Australia.

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Peter Harbison, the executive chairman of CAPA-Centre for Aviation, said Lion Air has operated mostly under the radar but has developed a quality product “weaned in the hothouse of an Indonesian market that grew five-fold in the last decade.

“These new orders won’t come online til the latter part of the decade, but meanwhile Lion has aspirations to be very much one of the big movers in short haul Asia,” Harbison told Australian Aviation. “I doubt it will be long before they come into the Australian market, first internationally, then domestically.”

The deal between Lion Air and Boeing includes purchase rights for 150 additional aircraft.

The 737 MAX that makes up the bulk of the order is in the final stages of design and currently slated for first flight in 2016. The single aisle jetliner features upgraded CFM International LEAP-1B engines designed to increase fuel efficiency and compete with the Airbus A320neo, which is scheduled to begin delivery in 2015.

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The deal was to be officially announced Friday at a ceremony attended by US President Barack Obama during the East Asia Summit in Bali.

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