Delta (DAL) has announced that it will buy 40 737-900ER planes from Boeing (BA) in a deal valued at around $4 billion. If sold separately the models list at around $99 million each. The new aircraft will carry around 220 passengers and will replace some of Delta’s narrow bodied planes that are scheduled for retirement. The new order will bring Delta’s 737 tally up to 140. The airline will also add 20 previously used Embraer (ERJ) jets to its fleet, which will commence flying along domestic routes from the fourth quarter of 2016. Larger regional planes are a welcome addition for airlines as more passengers means lower costs. The Atlanta-based airline will now be able to deploy some of its smaller, 70 seater regional jets to shorter routes. The new, 3-year contract proposal will be voted on by Delta’s pilot union on Wednesday, updated terms also include an increase in base salary for pilots and a revised profit sharing formula. In response to the deal negotiations, JP Morgan has now cut its third quarter earnings estimates for Delta by $0.10 share. However Delta stock rose around 1 percent following the deal news.
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