South Korean flag carrier Korean Air said yesterday it has signed a US$1.3 billion deal with US aerospace giant Boeing for 10 of its new generation B787 Dreamliners to upgrade its fleet.
The deal includes options for 10 additional B787s although Korean Air said it would consider buying more planes only if business prospects were good.
Korean Air said deliveries are scheduled from 2009 through 2011. The company now operates 115 aircraft including 85 Boeings and 29 Airbuses.
"The airline selected the 787s as part of its strategic plan to meet future demand for point to point travel on long-range destinations and to improve aircraft cost efficiencies," it said in a statement.
The deal is part of Korean Air's US$10 billion investment program to renew its fleet. It will include the purchase of up to eight super-jumbo A380 aircraft from Airbus, Boeing's arch-rival, with delivery scheduled to begin from 2007.
"This airplane deal signifies our commitment to our vision of becoming one of the world's top 10 airlines by 2010," Korean Air chairman Cho Yang-ho said in a statement.
"It exemplifies our long-range planning to ensure Korean Air's capability to meet future competition and market demand while also being more cost efficient," he said.
Korean Air said the purchase of B787s would reduce its costs by 10 percent.
"The options are not obligatory. We will consider buying additional B787s only if business prospects are good," a Korean Air official said.
Boeing said it has received 203 orders and commitments from 17 customers for the B787 since launching the jetliner less than a year ago.
"Korean Air's selection of the 787 continues the steady drumbeat of orders for this remarkable new airplane," Larry Dickenson, Boeing's vice president for sales, said in a statement.
Korean Air is the world's third-largest air cargo carrier and the 15th largest in terms of passenger numbers.
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