Published on : Friday, October 20, 2017
Singapore Airlines Ltd, one of the largest airlines in Asia began to finalize an order for 39 Boeing Co (BA.N) aircraft worth$13.8 billion at list prices when Singaporean Prime Minister Lee Hsien Loong visits Washington D.C. next week.
Singapore Airlines said in the month of February,2017, it would order 20 777-9 and 19 787-10 wide bodies as part of plans to modernise its fleet over the next decade.
But the deal was yet to be finalised and placed in Boeing’s order book as a Singapore Airlines order.
The deal with Singapore Airlines was viewed as a major blow to Airbus SE (AIR.PA) as it battles against Boeing in the wide body market.
The Airbus has lagged Boeing in net orders in the first nine months of the year, with 271 at the end of September versus 498 for its United States rival.
Singaporean Prime Minister Lee Hsien Loong hoped that an agreement in the aviation industry would be signed with Boeing to buy more aircraft for Singapore Airlines during his United States visit from October 22 to October 26.
Singapore Airlines in the month of February said it had also acquired options to order six more aircraft of each type.
Boeing in June booked orders for 20 777Xs and 19 787-10 aircraft for an unidentified customer or customers, making it possible the Singapore Airlines aircraft are already counted in this year’s net orders.
Singapore Airlines is investing in modern, latest techniques, fuel efficient aircraft while at the same time undertaking a strategic review designed to help cut costs amid growing competition from Chinese and Middle Eastern rivals.
While the Boeing order is worth $13.8 billion at list prices, airline authorities typically get discounts on jet orders.
Jefferies in February estimated the value of the the deal of Singapore Airlines at closer to $6.5 billion, or about a tenth of the U.S. plane maker’s annual volume.
Notably, Singapore Airlines is the open client for the 787-10, a stretch version of the Dreamliner, having made 30 firm orders in addition to the 19 announced in February.
Boeing Air finished the final assembly of the first 787-10 earlier this month ahead of delivery in the first half of 2018.