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EVA, CAL order new planes from Boeing

EVA Airways president Steve Lin, right, receives an EVA plane model from Boeing senior vice president Michael Cave after they signed contracts for the purchase of eight Boeing B777-300ER passenger planes yesterday. The deal is valued at US$1.49 billion. PHOTO: AFP

To meet the strong demand for passenger and cargo flights amid a recovering economy, the nation's two largest air carriers, EVA Airways Corp (長榮) and China Airlines Co (CAL, 華航), yesterday announced orders for new planes from Boeing Co.

EVA Airways announced that it has placed a US$1.49 billion order for eight Boeing B777-300ER passenger jets.

The company will take delivery of these aircraft between 2005 and 2009, EVA Airways president Steve Lin (林寶水) said at a joint press conference with Boeing.

Lin said the new planes will fly long-haul routes such as Taipei-London, Taipei-Paris and Taipei-Newark.

EVA and the US aircraft manufacturer agreed in June 2000 on the procurement of 15 B777-200LR and B777-300ER passenger jets, including a firm order for seven and an option for eight, EVA said earlier this week.

The company also plans to sell some of its Boeing 747s to other companies, or remodel them as freighters to meet increasing demand for cargo business.

As a result, EVA hopes to boost revenues from its cargo business to 60 percent of total revenues in the near term, Lin said.

"We expect most of this additional capacity to provide for growth of the airline," JP Morgan Chase Bank said in a note to its clients.

"The new aircraft offer superior range economics and unit costs over anything else in EVA's fleet and open up potentially new markets for EVA on the trans-Pacific," it said.

China Airlines yesterday also placed an additional order of two Boeing 747-400F freighters in response to strong cargo market demand. These new aircraft are scheduled to be delivered in 2006, the company said in a statement.

Air cargo demand for Taiwan will see an average of 7 percent annual growth from 2003 to 2007, CAL said, citing statistics provided by the International Air Transportation Association.

For the first quarter of this year, the company's cargo volume soared by 20.9 percent from the same period last year, the statement said.

Boeing expects to deliver about 285 planes to the world market in 2005, on par with its forecast for this year, Michael Cave, the company's senior vice president for airplanes programs, said yesterday at the press conference.

He also said he expects to see significant growth in business during 2006 and 2007.

Asked if Boeing plans to strike more deals in the fast-growing Asia Pacific region, Cave said the company expects to see this market account for one-third of its orders in the future, as it has in the past.
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