Planemaker Touts 56-Plane Lion Air Deal

Thank goodness for the 737. Even as Boeing faces increasing heat from customers over delays to its newest aircraft, the upcoming 787 Dreamliner, the planemaker was able to tout the latest accomplishments of its oldest aircraft family at this week's Singapore Air Show.

Indonesian carrier Lion Air, a loyal 737 customer, announced orders Tuesday for another 56 737-900ERs -- a $4.4 billion (list) order that will bring that airline's 737-900ER fleet to 178 planes by 2015, making it by far the largest operator of the long-fuselage, long-legged narrowbody.

"The Next-Generation 737 is the right airplane for our airline, our customers and our growing route structure," Kirana said. "Lion Air is committed to growing its fleet with fuel-efficient, reliable and technologically advanced aircraft, while offering its passengers the best service and lowest fares in the market."

Boeing launched the 737-900ER program in July 2005 when Lion Air announced the initial order for 30 planes.

The 737 order was by far the best news Boeing has received this week in Singapore, but it wasn't the only bright spot. Reuters reports Garuda Indonesia announced plans to convert its standing order for six Boeing 777-200s to 10 777-300ERs, a deal worth over $2 billion at list prices. Garuda also altered a previous unidentified order for seven 737-800s placed in 2007, and announced that it has converted 18 of its existing 737-700s on order to 737-800s and six 777-200ERs on order to 777-300ERs.

The planemaker also touted an announcement by Q Aviation, for an unspecified number of 767-300 Boeing Converted Freighters.

Notably absent from the order tallies, however, is Boeing's hot-selling 787 -- a plane that has racked up over 800 orders in four years, but has yet to make its first flight. The aircraft's development program has been delayed over nine months... and customers are definitely starting to grouse about it.

International Lease Finance Corp (ILFC), the world's largest aircraft leasing firm, told Reuters the company will seek large compensation from Boeing for the delays to its order for 74 jets, the first delivery of which is now pushed out to late 2010 or early 2011.

"We've put Boeing on notice that there will be some very serious talks," said Steven Udvar-Hazy, the outspoken CEO of ILFC. When asked if his company will seek compensation from Boeing for the delays, Hazy replied "Definitely, on a large scale."

The ILFC chief also noted his customers are increasingly disgruntled over the delays, with 15-20 of ILFC's 787 orders impacted by the delay. "It's not only the impact on us, it's the impact on our leasee -- the airlines," Hazy said.

Those statements come as ILFC ponders 100-plane orders for both Boeing and its European rival, Airbus. Arguably, Boeing is at the disadvantage in those negotiations with ILFC, due to the Dreamliner delays. Of course, it wasn't that long ago Udvar-Hazy was slamming Airbus, for delays to its A380 superjumbo and upcoming A350 XWB... but Boeing's the one making headlines now.

Randy Tinseth, Vice President of Marketing for Boeing Commercial Airplanes, acknowledged the planemaker is in a position where it has to show positive results, soon... but stopped short of promising the current 787 development schedule is set in stone.

"We really feel for our customers, we hate missing those commitments," said Tinseth. "We are now in a position with our suppliers where parts are manageable, so we have a confidence in our plans. But it's not going to be easy."

FMI: www.boeing.com, www.singaporeairshow.com.sg