Pilot Career Centre - Global
Pilot Career Centre - Global

Eva Air to purchase 24 B787-10's and 2 B777-300ER's

Eva Air to purchase 24 B787-10's and 2 B777-300ER's

2015 10 21

2015 10 21

The Eva deal, which isn’t yet a firm order, consists of two 777-300ER jets and 24 of the 787-10 Dreamliner. The transaction underscores customers’ interest in the 787-10, the longest and newest of three Dreamliner models, after the lull that followed the initial flurry of orders.

By Julie Johnsson

Boeing’s stretched version of the 787 Dreamliner, whose sales have slowed since its 2013 unveiling, is getting a boost from Taiwan’s Eva Airways.

Eva plans to take 24 of the 787-10 models and two 777-300ERs, Boeing said Thursday in announcing the carrier’s intentions, which aren’t yet a firm purchase. The airline settled on the Dreamliner after considering a competing Airbus Group model, the A350.

The 26 Boeing jets have a list price of about $8 billion, but airlines get large discounts on big orders so the real price is likely around $4 billion, according to data from aircraft-valuation firm Avitas.

The transaction underscores customers’ interest in the 787-10, the longest and newest of three Dreamliner models, after the lull that followed the initial flurry of orders. Only three fresh orders have come in since 2013. Boeing’s backlog of 146 jets for the 787-10 is only about 13 percent of the tally so far for the Dreamliner, the world’s first jetliner built chiefly of composite materials.

“There are people who had doubts,” said Richard Aboulafia, an aerospace analyst with consultant Teal Group. “It’s good to have an endorsement.”

Boeing is counting on the 787-10 to help reach profitability on the 787 program, whose commercial debut in 2011 ran more than three years late. The 787-10 retails for $306.1 million before the discounts that are customary in the industry, and Boeing should benefit from more efficient factory processes honed with the earlier versions.

The Eva deal also helps ease concerns that the twin-aisle-jet market is saturated with new aircraft, Aboulafia said by phone.

Boeing stock rose 2.4 percent to close at $137.39 Thursday. The shares tumbled 4.3 percent a day earlier when Delta Air Lines Chief Executive Officer Richard Anderson said he sees a “bubble” for widebody jetliners. Analysts called Wednesday’s drop an overreaction.

Eva, an offshoot of the Evergreen Line container-shipping company, announced five orders for 777 freighters at the Paris Air Show in June. The airline’s fleet now includes 21 777-300ERs, the world’s biggest twin-engine jet and a workhorse model on long-haul international routes.

Production and inventory costs for the 787, Boeing’s marquee jet, have ballooned to $27.7 billion as the plane-maker speeds output to a record pace of 12 jets a month by 2016. Boeing has said it expects costs to level out with the rate increase and then fall sharply as factories shift to the higher margin -9 and -10 models from the first version, the -8.

The first delivery of the 787-10 is targeted for 2018, with Air Lease, United Airlines, Singapore Airlines and British Airways among the initial customers. The plane is designed to carry 330 travelers in a typical two-class configuration, and fly as far as 6,430 nautical miles.

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