Alaska Air Group has finalized a significant aircraft procurement deal with Boeing Co., committing to the acquisition of 105 Boeing 737-10 aircraft, the most sizable model in the 737 MAX lineup. Additionally, the airline is set to take delivery of five Boeing 787 Dreamliners. This agreement represents the most extensive procurement in the history of Alaska Air, aiming primarily at fleet rejuvenation and bolstering future route development.
The airline's strategy includes deploying the 737-10 extensively on domestic routes characterized by high passenger volumes. By replacing older narrowbody aircraft, Alaska Air anticipates enhancing operational efficiency, targeting a reduction in per-seat costs. The infusion of 105 aircraft of this type underlines a substantial capital commitment focused on optimizing service capacity and cost effectiveness across its U.S. network.
Regarding the newly ordered Boeing 787 Dreamliners, Alaska Air indicates that these five widebody jets will facilitate growth into transoceanic markets, specifically across Europe and Asia. Key selling points for these aircraft center around their extended range capabilities, fuel economy, and elevated passenger comfort standards. This purchase expands Alaska Air's existing Dreamliner fleet, which currently numbers five, adding depth to its widebody aircraft operations.
Chief Executive Officer Ben Minicucci of Alaska Air Group articulated that the acquisition aligns with the "Alaska Accelerate" strategy, a framework designed to support broader destination reach worldwide. Minicucci emphasized that integrating newer, more fuel-efficient airplanes is an essential component of delivering enhanced customer experience and sustaining growth initiatives.
From Boeing's perspective, Stephanie Pope, president and CEO of Boeing Commercial Airplanes, underscored the value of Alaska Air's consistent growth trajectory. She expressed appreciation for Alaska's continued confidence in Boeing's 737 and 787 families, highlighting the agreement as a reinforcement of a durable collaboration dating back 60 years. That historic relationship began with Boeing's original delivery of a 727 to Alaska Air Group, pointing to enduring trust between manufacturer and airline.
Market performance data shows that Boeing's shares have appreciated over 32% in the past year, while Alaska Air's stock has declined by more than 22% during the same timeframe. As of publication, Boeing's stock traded up modestly by 0.30%, reaching $230.52, whereas Alaska Air's shares declined by 1.17%, closing at approximately $49.90.
The broader investment community can access Boeing's shares through instruments like the Direxion Daily BA Bull 2X Shares ETF, and Alaska Air Group stock is included in indices such as the U.S. Global Jets ETF. These financial products provide investors with diversified exposure to the airline and aerospace sectors influenced by this agreement.
Overall, this acquisition signifies a pivotal step for Alaska Air Group in pursuing fleet modernization and extending its market footprint, simultaneously cementing its longstanding partnership with Boeing. The emphasis on fuel efficiency, capacity, and passenger experience in this transaction aligns with industry trends favoring sustainability and operational excellence.