Boeing (BA.US) sees dual boost from "orders + regulation"! Secures major order for 120 aircraft and regains FAA's final clearance for new 737 Max and 787 jets

According to Zhitong Finance APP, Boeing (BA.US) secured two consecutive orders at the Farnborough International Airshow in the UK. One large order came from aircraft leasing company SMBC Aviation Capital, making it one of the first noteworthy major deals of this airshow, while the other came from Philippine Airlines. As of press time, Boeing shares were up by more than 1% in US pre-market trading on Monday.

Airshows are typically the main occasions where Airbus and Boeing strive for large aircraft purchase commitments, which are then officially announced during signing ceremonies. This year's Farnborough Airshow alternates with the Paris Air Show and provides Boeing with an opportunity to expand its deal-making activity. Previously, Boeing missed the last event after an aircraft accident occurred just days before the show.

On Monday, SMBC announced it would purchase 100 Boeing 737 Max planes, including 60 larger Max 10 models and 40 Max 8 models. Aircraft leasing companies have become an increasingly important customer group for both Airbus and Boeing. The leasing model allows airlines to modernize their fleets flexibly without the need to directly purchase expensive aircraft. In commercial aviation, single-aisle planes such as the 737 and A320 are the most widely used models, making them the most liquid and popular models in the aircraft leasing industry. Earlier this year, SMBC completed its acquisition of US leasing company Air Lease, further consolidating its position as the world's second-largest aircraft lessor after AerCap.

Boeing’s second order was from Philippine Airlines, which will be the Southeast Asian carrier’s first Boeing aircraft purchase in nearly twenty years. The airline has reportedly agreed to buy up to 20 787-10 “Dreamliners,” with delivery expected to begin in 2031. According to an announcement from Philippine Airlines, the memorandum of understanding includes a firm order for 15 787-10 aircraft, with options for an additional 5 planes.

This order from Philippine Airlines not only boosts Boeing's performance, but also helps ensure that US-made aircraft maintain market share in a market dominated by Airbus. According to Philippine Airlines’ annual report, as of the end of last year, the carrier's fleet comprised 82 aircraft, including 10 Boeing 777s for long-haul routes, 4 Airbus A350 long-range aircraft, and 11 Airbus A330s used on Asia-Pacific routes.

Aside from these orders, Boeing's capacity expansion has reached a critical turning point. After a near-catastrophic accident involving a 737 Max in 2024, regulators identified a series of quality issues at Boeing. Subsequently, the US Federal Aviation Administration (FAA) restricted Boeing’s aircraft production and revoked its authority to issue final release signatures for newly produced planes.

However, this authority is about to be restored. The FAA stated that the decision to reinstate this Boeing authorization will take effect on July 20, reflecting progress in the company’s efforts to improve quality management and regain regulatory trust. Meanwhile, the FAA emphasized that the agency will continue monitoring the airplane manufacturer’s quality levels.

This is vital for Boeing to expand its production scale, improve finances, and regain its competitive edge against rival Airbus. Currently, the US airplane maker is striving to stabilize production of its “cash cow” 737 series, aiming to keep monthly output at 47 units, with plans to gradually ramp up to 63 units per month in the coming years.

Earlier this month, Boeing officially launched a fourth 737 Max assembly line near Seattle to fulfill its growing backlog of orders, though initial output on the new line will be relatively low. This new line is a key component of Boeing’s strategy to increase 737 MAX production. Senior executive Jennifer Boland-Masterson stated at the time that Boeing would initially use a low-speed production model to address and resolve various production issues and ensure the smooth operation of the assembly line. She did not disclose the exact pace of production capacity expansion, but noted that hiring will increase as output ramps up.

US regulators are also expected to approve the latest models of the 737 Max series in the coming months. Although Rochelle said he could not provide a precise certification timeline for the 737 Max 7 and Max 10 models, he stated that Boeing is “getting closer day by day” to receiving approval. He indicated that certification work for the 737 Max 7 is "very close to completion."