Citing fleet commonality and aircraft performance, Southwest Airlines selected the 737 Max over the A320neo, said the airline's technical and operations leaders.
"When you looked at the way we fly, the gauge of our airplanes and all of the other details that make up our mission, we felt that the package around the Max was best suited to Southwest," said Brian Hirshman, the airline's senior vice president of technical operations.
The firm launch order for 150 737 Max aircraft will see the first aircraft delivered to Southwest beginning in 2017, and will be for either the 737-7 or -8.
"Our choice today of the 737 Max, guarantees to Southwest Airlines a single-fleet type well into the next decade, with all of the operational benefits associated with training, and schedule recovery and our maintenance programmes," said Mike Van De Ven, Southwest chief operating officer.
"The 737 Max delivers a competitive fuel burn improvement and engine reliability in a manner that minimises our operational complexity" he added.
The decision came after an technical evaluation of each Boeing and Airbus re-engined narrowbody.
"We did do comparisons between the 737 Max and the Airbus Neo and both airplanes deliver substantial improvements on their existing aircraft," said Van De Ven.
"That decision was not made lightly and was not made without a lot of work and analysis," he added.
"But given the choice of a re-engine with derivatives from the existing airplane we concluded that the 737 Max with its improved economics, its fleet commonality and our network fit was clearly the choice for Southwest Airlines."
Southwest has launched four of the 12 major 737 variants since the aircraft's launch in 1965, including the 737-300, -500 and -700, which make up the core of the airline's fleet today.
The 737 Max's lighter airframe and runway performance out of airports such as Southwest's Chicago Midway Airport hub tipped the competition in favour of the re-engined 737.
"For instance, Midway, that's got shorter field runways and given the weight characteristics of the aircraft we felt that the Max was just a better fit all around for that kind of mission profile," said Hirshman.
While Boeing has not yet firmed the configuration of the 737 Max, which is expected mid-2013, Southwest chief operating officer Mike Van De Ven said "most the big parameters have been defined".
"One of our requirements was that the Max was going to need to fly essentially at least the same mission as the NG, so same range, same payload, if not better, and we're satisfied that the Max will do that," said Hirshman.
With 350 deliveries scheduled for 2012 through 2022, including 150 737 Max aircraft, 127 737-700s and 73 737-800s, Southwest will advance replacement of its 737-300 and -500 fleet, which Van De Ven said is 16-18% less fuel efficient compared to the CFM International Leap-1B-powered 737 Max.