Singapore jet commitment 'major win' for Boeing

Posted February 10, 2017

Boeing (NYSE:BA) still must sell more 777 and 787 jetliners to keep production plans on track despite today's $13.8B Singapore Airlines order, CEO Dennis Muilenburg says.

Deliveries of the jets will start as early as in the financial year ending March 2021, the carrier said, adding it also has options to buy six more of each of the two models.

Announcing the commitment on February 9, Boeing said the order will be posted on the its Orders and Deliveries website once finalized.

SIA has selected the 777X and additional 787-10s to expand its future widebody fleet. The program now has a roughly five-year production backlog, and Boeing has said a future increase in production rates will depend on the ability to book new orders. Boeing was nearing an order for at least 35 wide-body aircraft from Singapore Air, Bloomberg News reported Wednesday.

The order represents something of a reprieve for Boeing after it lost a competition with Airbus in 2015 to provide a widebody capable of flying between Singapore and the US starting in 2018.

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In addition to 30 previously-ordered B787-10s, SIA has outstanding orders with Airbus for five A380-800s and 57 A350-900s.

Shares of the airline rose 1.4 percent to S$9.94 on Thursday in Singapore trading before the announcement.

Singapore Airlines already has more than 50 Boeing 777s in service.

Singapore Airlines - considered one of the world's most luxurious carriers - has been named in unofficial reports as the first recipient of Boeing's 787-10, to be delivered during the first half of 2018. The engine contract also includes TotalCare support.

SIA is facing heightened competition, especially on long-haul routes linking Singapore to Europe and North America, due to the strength of Middle Eastern carriers such as Emirates.