By Alwyn Scott

SEATTLE, Jan 25 (Reuters) - Boeing Co said it had tentatively scheduled the first flight of its newest airplane, the 737 MAX, for Friday, a sign that it is on schedule for another key milestone for its top-selling plane.

Boeing had said it planned to make the flight in the first quarter of 2016. Like all first flights, the 737 MAX takeoff could be delayed by weather or other conditions, Boeing said.

The Chicago-based company said it finished key development steps, readying the plane for its first takeoff. It is due to be delivered to airlines starting in 2017.

The 737 MAX, the latest generation of Boeing's best-selling 737 aircraft, is a major cash generator for the company. It had 3,072 firm orders at the end of 2015, more than half of Boeing's 5,795-plane backlog.

It is an updated version of Boeing's stalwart 737, which first flew in 1967, fitted with new engines made by CFM that Boeing predicts will cut fuel burn per seat by 14 percent compared with the current 737s.

The first 737 MAX flight comes 17 months after Airbus first flew its rival A320neo equipped with Pratt & Whitney geared turbofan engines, and nine months after the A320neo equipped with CFM engines first flew.

Airbus commenced the A320neo program in December 2010, nine months before Boeing launched the 737 MAX program. CFM is a joint venture of General Electric Co and Safran SA.

(Reporting by Alwyn Scott; Editing by Phil Berlowitz)