Boeing strikes $7.2 bln deal at airshow

Boeing strikes $7.2 bln deal at airshow

FARNBOROUGH, England - Reuters
Boeing strikes $7.2 bln deal at airshow

AFP photo

U.S. planemaker Boeing landed the first blow at this week’s Farnborough Airshow, winning an order worth up to $7.2 billion from U.S. lessor Air Lease, as a market share battle with its European rival Airbus plays out.

Boeing said in the British town yesterday that the order was for 75 of its fuel-efficient 737 Max jets - a model that is key to its attempted fightback against Airbus’s rival A320neo short-haul aircraft. 

Airbus and Boeing are locked in their fiercest battle for up to a decade, slashing prices to win orders for their latest narrowbody jets.

Boeing chief executive Jim McNerney has predicted the U.S. planemaker, helped by the 737 Max, will outsell Airbus for “a number of years” having trailed its European rival for nearly a decade. Airbus also expects Boeing to make up ground this year. 

Los Angeles-based Air Lease, which buys planes and leases them to airlines, also has the right to purchase an additional 25 of the planes. The order will take several years to deliver. ALC has ordered a total of 170 airplanes from Boeing. Although the order has a list price of $7.2 billion, purchasers rarely pay the full price for an order of this size.

Ray Conner, head of Boeing Commercial Aircraft, said between the roars of display flights and the clinks of corporate hospitality that the U.S. company was confident of growing market share but does not have a specific target in mind.

“We are focused on producing and winning,” he told reporters at the event, which was attended by British Prime Minister David Cameron. EADS unit Airbus booked orders for 1,419 planes worth some 90 billion pounds ($140 billion) in 2011, compared with Boeing’s 805. The pair compete for a jet market estimated at $100 billion a year.