ALASKA AIR GROUP, IN

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Alaska Airlines to Lease 13 New 737-9 MAX Aircraft in Modernization Bid

11/23/2020 | 12:57pm

By Kimberly Chin

Alaska Air Group Inc. said it will lease 13 new Boeing Co. 737-9 MAX aircraft and sell 10 Airbus A320s to Air Lease Corp., in a move that will help modernize its mainline fleet.

The carrier will receive the leased aircraft starting in the fourth quarter of 2021 through 2022, the company said. The 737-9 MAX aircraft are 20% more fuel efficient, have 20% less carbon emissions per seat and can fly farther than the A320s, the company said.

Alaska Airlines' parent expects to begin flying the 737-9 MAX in March.

It will also lease back the A320s from Air Lease for a short period of time after the deal closes in order to align with its fleet modernization plan, the company said.

"We found an opportunity to sell 10 planes that are not in our long-term plans and replace them with 13 of the most efficient narrow-body aircraft available," Alaska Air Chairman and Chief Executive Brad Tilden said.

The new leased aircraft are in addition to 32 MAX aircraft the company has currently ordered from Boeing.

With the transaction, some of Alaska Air's debt that was previously collateralized by the 10 Airbus A320s was prepaid, the company said in a securities filing. The prepaid debt, associated fees, as well as sales proceeds, were about $272 million. The company has excluded that figure from cash burn projections in the fourth quarter, it said in the filing.

Write to Kimberly Chin at kimberly.chin@wsj.com

(END) Dow Jones Newswires

11-23-20 1256ET

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