Boeing Co., the world’s biggest planemaker, won an order from PT Garuda Indonesia for 50 single-aisle planes as economic growth encourages more people to travel by air.
The contract, worth $4.9 billion at list price, is for 46 737 Max 8s and four to be converted from an existing order of 737-800s, Boeing said in a statement. The Indonesia airline currently operates 77 of the narrow-body 737s.
The state-controlled Garuda is competing with PT Lion Mentari Airlines in a market where passenger numbers are expected to increase as an emerging middle class travels more. From Indonesia to Vietnam to Myanmar, carriers in Southeast Asia are buying aircraft to serve a market of about 600 million people, roughly equal to Brazil, Germany and the U.S. combined.
By the end of this year, Lion Air and Garuda will surpass Singapore Airlines Ltd. as the region’s biggest carriers by fleet size, the CAPA Centre for Aviation, which advises airlines, said last year.
Garuda said in July that it would reduce capacity this year by selling older aircraft and could defer plane deliveries in the short term because of excess capacity in the region, something carriers such as AirAsia Bhd have already done. The airline plans to increase its fleet to about 250 by the end of 2025, from 194 planes by the end of 2015, Satar has said.