MONTREAL - Air Canada today announced its mainline narrowbody fleet renewal plan includes commitments, options and rights to purchase up to 109 Boeing 737 MAX aircraft, the new aircraft will replace Air Canada's existing mainline fleet of Airbus narrowbody aircraft.

The agreement with Boeing, subject to completion of final documentation and other conditions, includes firm orders for 33 737 MAX 8 and 28 737 MAX 9 aircraft with substitution rights between them as well as for the 737 MAX 7 aircraft.

When finalized, the firm order for 61 737 MAX 8 aircraft and MAX 9 aircraft is expected to be worth $6.5 billion at list prices.

It also provides for options for 18 aircraft and rights to purchase an additional 30. Deliveries are scheduled to begin in 2017 with 2 aircraft, 16 aircraft in 2018, 18 aircraft in 2019, 16 aircraft in 2020 and 9 aircraft in 2021, subject to deferral and acceleration rights.

Calin Rovinescu, president and chief executive officer of Air Canada, said:"We are pleased to announce our agreement with Boeing for the purchase of 737 MAX aircraft as part of the ongoing modernization of Air Canada's fleet.

"Renewal of our North American narrowbody fleet with more fuel efficient aircraft is a key element of our ongoing cost transformation program and the enhanced passenger cabin comfort provided by the Boeing MAX will help us to retain Air Canada's competitive position as the Best Airline in North America.

"Our narrowbody fleet renewal program is expected to yield significant cost savings. We have estimated that the projected fuel burn and maintenance cost savings on a per seat basis of greater than 20 per cent will generate an estimated CASM reduction of approximately 10 per cent as compared to our existing narrowbody fleet."

Brad McMullen, vice president of North America sales, Boeing Commercial Airplanes, added:"We're honored that Air Canada chose Boeing to lead its fleet renewal plan.

"We know the 737 MAX will provide the airline and its customers with an experience that can't be matched."

Air Canada continues to evaluate the potential replacement of its Embraer E190 fleet, the airline has reached an agreement with Boeing, for the aircraft maker to purchase up to 20 of the 45 Embraer E190 aircraft currently in Air Canada's fleet.

The E190 aircraft being phased out will be temporary replaced with a yet to be decided aircraft type, leased until the airline takes delivery of the Boeing 737 MAX aircraft. The company will review various options over the next six months for the remaining 25 Embraer E190 aircraft including continue to operate or replace the aircraft with a type in the 100 to 150 seat range, to be selected at later stage.

Air Canada's plan for its total fleet including its subsidiary Air Canada rouge, excluding aircraft flown by its contracted regional carriers, to be increased from 192 aircraft as at September 30, 2013 to about 214 by the end of 2019.

For any foreseeable growth, Air Canada has 13 options and rights to purchase 10 Boeing 787 aircraft, rights to purchase 13 Boeing 777 aircraft and the 18 options and 30 purchase rights for Boeing MAX aircraft.