Singapore Airlines Places Big Order For New Jets
NEW YORK (AP) — Singapore Airlines said Thursday that it ordered 60 new planes from Boeing and Airbus that carry a combined list price of more than $17 billion.
The orders were evenly split — 30 planes from U.S.-based Boeing and 30 from Europe's Airbus. Airlines typically get deep discounts on planes, and Singapore did not say how much it will pay the manufacturers.
For Boeing, it was the first announcement from an airline about the proposed longer version of its 787, which the company calls the Dreamliner. Singapore said that the order was conditioned on Boeing actually launching the 787-10X. If Boeing produces the plane, Singapore would take deliveries starting in 2018-2019 and use them on medium-range routes.
The order for an aircraft program that hasn't even been launched yet was good news for Chicago-based Boeing, which suffered through a 4-month, worldwide grounding of the first 50 Dreamliners after lithium-ion batteries overheated in two of the planes. Boeing made changes in the battery systems that won approval from the U.S. Federal Aviation Administration, and the planes resumed flying this month.
In a statement, Boeing said it "welcomes Singapore Airlines' interest in the 787-10X, and we look forward to continuing discussions with the airline to satisfy their fleet requirements."
Boeing has 890 firm orders for other models of the Dreamliner.
In afternoon trading, Boeing shares rose $1.77, nearly 2 percent, to $100.86.
Singapore called the Boeing-Airbus order among its largest ever and said it gave the airline room to grow while updating its fleet.
The orders "demonstrate our commitment to the Singapore hub and our confidence in the future for premium full-service travel," said CEO Goh Choon Phong.
Singapore, a premium airline, is facing competition in Asia from fast-growing, low-fare airlines including Lion Air of Indonesia and AirAsia of Malaysia, which have also announced large aircraft orders, and from state-backed airlines in the Middle East such as Emirates and Etihad.
The weak global economy has weighed on Singapore's recent financial results. It reported this month that net income in the fiscal year ended March 31 rose 13 percent, thanks to sales of surplus planes and engines, but operating profit fell 20 percent.
Besides the Boeing jets, Singapore said it would get 30 Airbus A350-900 aircraft beginning in 2016-2017 and placed options for 20 more. The options could be converted to a slightly larger model, the A350-1000.
Coming on top of previous orders, Singapore now has committed to buy 70 of the A350s, which it plans to use on medium-range and long routes. Airbus is owned by European Aeronautic Defence and Space Co., or EADS.
Singapore Airlines now has 126 firm aircraft orders with the two big manufacturers.