German air carrier Lufthansa has announced that its board has approved orders for 30 new passenger jets from Airbus and five new cargo planes from The Boeing Company (BA). The value of the order split between the two companies’ totals about $4 billion.
Under the order, Airbus will supply 30 passenger airplanes including 25 A320neo and five A321neo aircraft. The Airbus order is worth $2.7 billion. The Lufthansa order for Boeing includes five new Boeing 777 freighters and is worth $1.3 billion.
Airbus said that the new jets will have upgraded engines which will burn about 15% less fuel than the present models and will be quieter than existing models. These jets are expected to be delivered from 2016. Boeing is expected to deliver the cargo planes beginning in 2013.
Of late, Lufthansa has become the largest international airline to buy the new Airbus jets. Lufthansa’s current order, which remains to be finalized, brings the number of orders for A320neo-family jets in the pipeline to just over 300.
Boeing said it is considering building a new version of its popular 737 aircraft to counter the move by Airbus.
As of March 1, 2011, net orders received by Boeing stands at 17 airplanes, while deliveries for commercial airplanes for the first two months of 2011 touched 61 airplanes. Apart from receiving a steady stream of commercial airplane orders, Boeing successfully booked orders for its military airplanes.
Based in Chicago, The Boeing Company designs and produces commercial airplanes, defense systems and civil and defense space systems. The company competes with the likes of Lockheed Martin Corporation (LMT) and Northrop Grumman Corporation (NOC).
The Boeing Company currently retains a Zacks #4 Rank (short-term Sell rating). Considering the fundamentals, we are maintaining our Neutral recommendation on the stock.
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