But Some Fear Carrier May Have Problems Paying

It would be the biggest 737 order ever from a German airline. But analysts fear Air Berlin may have some difficulty in securing funding for the 60 Boeing aircraft the carrier announced it plans to purchase from the American aerospace company.

Florence Tassan, an analyst at Societe Generale, told CBS Marketwatch the 14.3 percent drop in the low cost carrier's stock price that followed announcement of the order stems from concerns over funding for the fleet expansion. She added that the outlook is "quite vague."

By contrast, Air Berlin CEO Joachim Hunold says the airline is already looking past the order, trying to decide whether to add another 40 planes next year -- and whether those will also be 737s, or Airbus A320s. Hunold says Air Berlin is "exploring alternatives" for financing the 737 order.

Boeing greeted the news of the Air Berlin order with what could be described as measured enthusiasm.

"The Boeing Company is delighted that German airline Air Berlin intends to purchase 60 Boeing Next-Generation 737-800s and is also identifying an order placed earlier this year for 15 737-700s," the manufacturer said in a statement to ANN. "The combined value of the 75 airplanes is $5.1 billion at list prices."

"Air Berlin and Boeing are in the process of finalizing the order for the 60 airplanes," Boeing continued. "The 15 737-700s were purchased by German airline dba and previously accounted for on the Boeing Orders & Deliveries Web site, but were not identified. Since then, dba has been acquired by Air Berlin."

Boeing states Air Berlin also has 10 unfilled 737-700 orders from a dba order announced in 2005. If Air Berlin exercises all its orders, it will take delivery of a total of 85 737s, beginning in November 2007.

FMI: www.boeing.com, www.airberlin.com