Singapore Air Expands Boeing 777X Order in Boost to Jumbo’s Heir
(Bloomberg) -- Singapore Airlines Ltd. is swapping some of its Boeing Co. wide-body jetliner orders for the larger 777X, giving a boost to the model as part of an agreement to slow near-term deliveries from the U.S. planemaker.
The airline will pare commitments for the Boeing 787-10 Dreamliner by 14 planes, while adding 11 777-9s to its existing order, according to a statement Tuesday. The change brings Singapore Airlines’ total orders to 31 for Boeing’s largest aircraft, a vote of confidence in the heir to the manufacturer’s iconic 747 jumbo.
The move, combined with an earlier agreement to defer Airbus SE deliveries, will delay more than S$4 billion ($3 billion) in capital spending, Singapore Airlines said. The carrier has been hit especially hard by Covid-19 travel restrictions because there’s no domestic market to rely upon in the city-state.
With the latest agreement, Singapore Airlines’ expenditure on aircraft will fall every year until March 2024. For the current fiscal year, its spending will drop to S$2.8 billion from S$5 billion. The carrier didn’t provide further detail on delivery timing by aircraft type.
The added 777X orders -- the first since well before the coronavirus pandemic -- are a shot in the arm for the beleaguered wide-body. The aircraft has suffered multiple delays in its entry into service, leading Boeing to take a $6.5 billion charge with its fourth-quarter earnings. The planemaker revealed in a filing last week that about a third of the jet’s order haul was at risk.
Boeing shares rose less than 1% to $212.27 at 10:34 a.m. in New York. The stock had declined 37% during the 12 months through Monday, the worst performance among the 30-member Dow Jones Industrial Average.
“We are honored that Singapore Airlines is reaffirming its commitment to the 777-9,” Boeing said in a statement.
An Airbus spokesman declined to comment on customer fleet planning and strategy.
Carriers around the world are pushing back aircraft deliveries after the pandemic destroyed travel demand and saw thousands of planes grounded.
The blow has been hardest on aircraft built to cruise across oceans. Orders for wide-body jets such as the 777X, Boeing’s 787 Dreamliner and competing Airbus models are expected to be the last to recover from the slump.
|Aircraft type||Number on order for SIA|
|Boeing 737 Max||31|
Singapore Air has 15 A350-900s still to be delivered from Toulouse, France-based Airbus.
The carrier said in November that it had concluded negotiations with Airbus on a revised fleet delivery schedule “incorporating deferrals for part of the aircraft on order.”
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