Korean budget carrier Jeju Air and Boeing have struck a deal for up to 50 jets valued at $US5.9 billion at list prices.
The deal for 40 737 Max 8 aircraft and options for a further 10 jets is the biggest order ever placed by a Korean low-cost carrier.
It comes at an opportune for time for the manufacturer, which has been taking flak over the loss of a Lion Air 737 MAX 8 on October 29 with 189 people on board.
Jeju, which began operations in 2005 and was Korea’s first low-cost carrier, has grown rapidly alongside Korea’s LCC and broader commercial aviation market
It now flies a fleet of almost 40 next-generation 737-800s and serves 60 domestic and international routes with about 200 daily flights.
The growth has been accompanied by financial success which has seen the airline achieve 25 percent annual sales growth over the past five years with 17 consecutive quarters of profitability.
Jeju is also a founding member of the Value Alliance, the first pan-regional low-cost carrier alliance formed with eight airlines based in Asia.
The route between the holiday island of Jeju and Seoul’s Incheon airport is now the busiest air route in the world but the LCC is expecting more growth due to rising air travel demand in the South Korean market.
“With Korea’s growing commercial aviation market, we are excited to take the next step in expanding our business with the 737 MAX, a world-class airplane that will allow us to improve our operation and continue to provide a safe and enjoyable experience for our passengers,” Jeju chief executive Seok-Joo said in a statement.
“The 737 MAX 8 and its superior performance and economics make it an ideal airplane to implement our growth strategy as we look to expand beyond Asia in the coming years.”
The 737 MAX 8 provides more range than its predecessor and offers 14 percent better fuel efficiency and environmental performance thanks to the latest CFM International LEAP-1B engines, advanced winglets, and other aerodynamic improvements.
Boeing Global Services will also provide Jeju Air with digital tools to reduce its operating costs, Boeing said. The solutions included the Fuel Dashboard Program, which allows operators to look across their fleet and identify areas where they can optimize their fuel spending.
The 737 MAX is the fastest-selling airplane in Boeing history with about 4,800 orders from more than 100 customers worldwide.