Boeing Has a Secret Weapon for Competing With the Airbus A321

Boeing Has a Secret Weapon for Competing With the Airbus A321

When Boeing (NYSE: BA) launched the 737 MAX 10 earlier this year, many aerospace pundits panned it as a poor man's Airbus (NASDAQOTH: EADSY) A321. Nevertheless, the 737 MAX 10 won hundreds of orders and commitments at the 2017 Paris Air Show, including an important order conversion from U.S. airline giant United Continental (NYSE: UAL).

In fact, Boeing has a secret weapon that has helped it win all of United's new narrowbody aircraft orders recently: a "most-favored customer clause" granted by Airbus to American Airlines (NASDAQ: AAL). This clause could give Boeing a huge advantage in competing for an upcoming aircraft order from Delta Air Lines (NYSE: DAL).

Back in 2011, Airbus scored a major coup when American Airlines ordered 260 A320-family jets, after years as an all-Boeing airline. Indeed, it was this impending order that forced Boeing to create the 737 MAX to hang on to a portion of American's business.

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Source: Fool.com