Boeing (NYSE:BA) stock is on the move Wednesday after receiving an order for its 737 MAX jets from Alaska Airlines.
That has the Alaska Air (NYSE:ALK) subsidiary ordering 52 new jets from Boeing. The order is split into 42 737-10 and 10 737-9 jets. Alaska Air is ordering these jets from Boeing as it modernizes its fleet of aircraft.
The addition of 737-10 jets is a big deal for Alaska Air, as it currently uses 737-9 jets. These can seat 204 passengers, an improvement compared to the 178 passengers that can be seated on the 737-9 jets. Looking forward, Alaska Air’s entire fleet will be made of Boeing jets by 2023; the company has an “unfilled orderbook for 737 MAXs” totaling more than 100 jets.
Stan Deal, President and CEO of Boeing Commercial Airplanes, said the following in a news release:
“As Alaska Airlines sustainably grows its fleet, the 737 MAX family offers environmental performance and flexibility to expand service across its route network […] Built in our Renton factory near Alaska’s headquarters in Washington state, these airplanes will carry passengers to destinations for years to come.”
What the Deal Means for BA Stock
Obviously, Boeing benefits from the actual order itself, but there’s more to it than just that. The company went through a rough time during the pandemic as airlines saw decreased demand. Alaska Airlines ordering new planes could be a sign that these troubles are easing. That may mean more orders for Boeing in the future as other airlines expand their fleets.
BA stock is up 1% as of Wednesday morning after falling 28.8% year-to-date (YTD).
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.