Boeing lands big 717 order

A1FlyBoy

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Only a few months after it considered closing the 717 production line because of slow sales, The Boeing Co. has won one of its biggest orders ever for its smallest jetliner.

Milwaukee-based Midwest Express, voted the nation's top airline in a consumer survey, has inked a deal to buy 25 of the planes, Boeing announced yesterday.

Including another 25 options, the 50 planes are worth about $1.8 billion at the average list price of the 717.

The deal completes a preliminary agreement between Boeing and Midwest Express that was announced last year.

Midwest will take five more planes than it previously planned, and it will accelerate deliveries, Boeing said. The 717s will be delivered to Midwest beginning in February 2003 and continue into 2005.

The order is a significant boost for the 717 program and is the largest single order for the model since TWA ordered 50 planes with 50 options nearly four years ago. By deciding to go ahead and order the Boeing jets rather than possibly turning to the Airbus A318, Midwest has signaled that it believes Boeing has confidence in the future of the 717 and will continue production.

An airline would be unlikely to buy planes if it believed the model might soon go out of production because the residual value of the planes would be greatly diminished.

"This order is a huge vote of confidence in the capabilities of the 717 airplane," Toby Bright, Boeing's executive vice president of jetliner sales, acknowledged in a statement.

Midwest will lease the new planes and is expected to get financial help from Boeing Capital Corp.

The deal with Midwest brings to 162 the number of firm orders for the 717 since the program was launched by McDonnell Douglas in the mid-1990s. Boeing has a remaining backlog of 66 planes ordered but not delivered. In addition, customers have 112 options, including the 25 from Midwest.

Completion of the order from Midwest will not mean a change in production rates for the 717, which is assembled in Long Beach, Calif., Boeing said.

Late last year, Boeing decided to keep the 717 line open but at greatly reduced production pending better sales. Boeing won't say what the new production rate is, but it is believed to be about 1.5 planes a month. It had been as high as five a month.

Boeing had considered closing the line because it was losing money because of slow sales. The program also was hurt when American Airlines last year acquired TWA and decided it did not want the TWA 717s. American is in the process of returning the 30 planes that were delivered to TWA.

American also canceled orders for the remaining 20 TWA 717s that had not been delivered.

Boeing is trying to find customers for the 30 used TWA planes.

Midwest is getting new planes, not the used TWA 717s.

But the airline likely got a hefty discount from Boeing and probably is getting some of those 20 TWA jets that had been ordered but had not yet been built.

Before it decided on the 717 last year, Midwest considered the Airbus A318. That model, which has not yet entered service, will be the smallest Airbus jet in the A320 family.

The 717 is a short-haul plane that was developed by McDonnell Douglas as a replacement for the DC-9.

Midwest operates a fleet that includes 23 DC-9s and 12 MD-80 series jets.

Midwest said it is speeding delivery of its 717s to replace those older DC-9s.

Formerly known as the MD-95, the 717 became part of the Boeing lineup when the company acquired McDonnell Douglas. The first plane entered service with launch customer AirTran in 2000. AirTran has accelerated plans to grow its 717 fleet this year and next and has already exercised some of its options. AirTran expects to have 50 of the jets in its fleet by the end of this year.

Midwest Express is only the fourth U.S. carrier to order the 717. AirTran, formerly ValuJet, ordered 50 planes with 50 options, as did TWA. Hawaiian Airlines ordered 13 717s in 1999.

Midwest, which began service in 1984, is known for providing passengers with wide leather seats in a two-across configuration, food served on china and baked-on-board chocolate-chip cookies. The airline said it will configure its 717s to seat 88 passengers. The plane typically seats about 106 passengers.

Midwest was named the top domestic carrier in last year's Zagat airline survey based on comfort, service and food.
 

SkywayFO

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Where have you been ME has had those orders for year or more. I think the original order was for 20 I think they add 5 more. And picked up the pace on delivery. That in is amazing since they usual take forever to make a decision. Hopfully week can gethe Emb 145's comming soon too. Since Dornier screwed us again. I still think the 318 would have been a better buy.
 

corky

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The original order was 20 firm 30 options. They switched it to 25 firm 25 options.

318 is not really comparable to the 717. The 318 is a 737-600 competitor. Besides, the DOC of the 318 will NEVER be as low as the 717. The 318 is in flight testing now and missing its performance numbers big time. the 717 was 5% better than predicted.

The only problem with the 717 for MDX is the range but aux tanks may be offered as a future option.
 

A1FlyBoy

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I knew those order numbers were adjusted. Thanks for the stats Corky!
 
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