DALLAS - Norwegian Air Shuttle (DY) has signed an agreement in principle with Boeing to renew its order for 50 Boeing 737-8 MAX aircraft.

The deal also includes options for an extra 30 planes. The 50 MAXs will be delivered between 2025 and 2028, on a timeline that closely matches current aircraft lease expirations. This entails a small net increase in the current fleet of the corporation.

According to a DY release, the deal is subject to a number of closing conditions, which are expected to be met by the end of June 2022.

Due to the global grounding of the aircraft model, the airline threatened to cancel a previous order for 92 of the type in June 2020. The airline was the first European carrier to choose the 737 MAX, announcing a firm order for 100 of the new, highly fuel-efficient airplanes.

The order cancelation, however, never came to fruition. It even filed a lawsuit a month later, accusing Boeing of breaking its contract over the way the manufacturer managed aircraft production and delivery.

Now, the airline plans to use positive cash flow from operations to cover the remaining balance of pre-delivery payments. The corporation will own a large portion of the aircraft, ensuring a well-balanced aircraft financing structure. DY says it forecasts a net gain of around NOK2bn following the execution of these deals.

Norwegian wants to operate a modern and fuel-efficient fleet, as demonstrated by the purchase agreement. The Boeing 737-8 is approximately 14% more fuel-efficient than previous-generation aircraft, putting the business on track to meet its aim of a 45% reduction in emissions by 2030.

Comments from Norwegian Air Shuttle Officials

“This is a landmark deal that sets out a path whereby Norwegian will own a large share of its fleet. This will result in lower all-in costs and increased financial robustness, enabling us to further solidify our Nordic stronghold. The deal also allows us to serve our customers with state-of-the-art aircraft that can run increasingly on sustainable aviation fuel,” said Svein Harald Øygard, Chair of the Board of Norwegian.

“The overall terms achieved are attractive for Norwegian, and the deal fits well with our long-term fleet strategy and route program. It will enable us to serve our customers with modern, fuel-efficient aircraft with the latest technology, significantly reducing our carbon footprint. The deal will also strengthen the company’s equity considerably, further solidifying Norwegian’s financial position," said Geir Karlsen, CEO of Norwegian.

The new MAX's tails honor Norwegian explorers, Nobel Laureates, and world-famous aviators, writers, singers, scholars, and athletes.

Featured image: Norwegian Air Shuttle's Boeing 737-8 MAX. Photo: DY, Creative Commons Attribution.