Boeing Co is expected to sell nearly 80 787 Dreamliner airplanes to two Saudi Arabian airlines, a source briefed on the matter said on Monday.
An announcement of the plan reported earlier by the Wall Street Journal was expected as early as yesterday, and the list prices for 78 planes was nearly US$37 billion. Airlines typically receive undisclosed discounts when buying airplanes.
State-owned Saudi Arabian Airlines and new national airline Riyadh Air are expected to buy a total of 78 Boeing 787s split between them and have options to buy another 43, the source said.
Photo: EPA-EFE
Saudi Arabian Crown Prince Mohammad bin Salman formally announced on Sunday the creation of Riyadh Air, with industry veteran Tony Douglas as chief executive, as the kingdom moves to compete with regional transport and travel hubs.
Riyadh Air is to serve more than 100 destinations around the world by 2030, making use of the kingdom’s location between Asia, Africa and Europe, the state-run Saudi Press Agency said.
The new airline is expected to add US$20 billion to Saudi Arabia’s non-oil GDP growth and create more than 200,000 jobs, directly and indirectly, it said.
Riyadh Air is wholly owned by Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, which has more than US$600 billion in assets and is spearheading the kingdom’s efforts to diversify its economy and wean itself off oil.
In October last year, Saudi Arabia was in advanced negotiations to order almost 40 A350 jets from Airbus SE, while Boeing was also lobbying for a slice of the kingdom’s transportation expansion, industry sources had said.
The Saudi Arabian deal comes on the heels of a major order in December last year from United Airlines Holdings Inc for 100 787 Dreamliners and 100 737 MAX jets.
Earlier this month, Reuters reported that Indian budget carrier IndiGo Airlines Pvt Ltd was in talks with Boeing and Airbus to purchase more than 500 aircraft, an order that had been expanded to include wide-body planes such as the 787 or Airbus A330neo.
On Friday, the US Federal Aviation Administration announced it would allow Boeing to resume deliveries of the 787 this week that had been temporarily suspended since last month.
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