Wednesday, October 26, 2016

Boeing sells an extra 777-300ER to Swiss Air, makes progress on Iran deal for 34 more widebodies

Swiss International Air Lines said Tuesday it's ordered an extra Boeing 777-300ER (Extended Range) airliner in a deal worth $339.6 million at list prices.

Boeing announced the surprise deal as it released third quarter earnings, though the airplane will not be delivered until some time in 2017.

Boeing's entire remaining 2016 production of the 777-300ER wide-body jet, manufactured in Everett, is sold out.
The Swiss airline previously ordered nine 777s and took delivery of six this year as it makes the 777-300ER its flagship large jetliner.

Peter Wojahn, Swiss Air's chief technical officer, said the 777-300ER will be the backbone of the airline's long-haul fleet "for many years to come."

"As one of the largest operators of the 777-300ER in Europe, we can offer our passengers unrivaled frequency and passenger comfort to a number of intercontinental markets thanks to this super-efficient long-haul aircraft," Wojahn said.

Swiss Air likely increased its order for 777s to take advantage of a lull in sales for wide-body jets around the world. Thus, it likely paid below the list price.

Boeing doesn't disclose actual prices paid by its airline customers.

Monty Oliver, vice president of European sales for Boeing Commercial Airplanes, said the jet maker values the confidence Swiss Air places in the 777 program and is glad to be involved in the airline's expansion plans.

During Tuesday's conference call with reporters, Boeing CEO Dennis Muilenburg also said despite current hesitation among airlines to buy wide-body jets, the market is strong.

Muilenburg noted Boeing's government-approved deal to sell 80 new airplanes to Iran Air includes a mix of 34 wide-body planes.

"There's more work to do to finalize the sale, but we are encouraged by the progress," the Boeing CEO said. He added the timing and outcome of several other ongoing wide-body sales campaigns "will be the determining factors" in final decisions on whether to cut 777 production rates in Everett.

Long-term demand for twin-aisle jets is also fantastic, Muilenburg said.

"Specifically for the wide-body market, we see demand over the next 20 years for more than 9,000 aircraft and see replacement demand starting to accelerate again early next decade," he said. "We're well positioned with the 777X and 787 (Dreamliner) families."

(Andrew McIntosh - Puget Sound Business Journal)

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