Boeing will supply 103 aircraft to Korean Air worth $36.2 billion at list prices, the U.S. planemaker said on Tuesday, in a bid to support South Korea’s flag carrier’s long term expansion of its fleet.
According to the statement released by Boeing, the order would comprise 20 777-9s, 25 787-10s, 50 737-10s and eight 777-8 Freighters.
Only the 787s are currently certified for commercial service, whilst the aircraft company is developing the 777-8 Freighter. Aviation advisory and intelligence firm IBA estimated the aircraft order at $12.6 billion after discounts.
Korean Air reported the entire package to be priced at $44.8 billion, which includes an $8.6 billion deal for the purchase of 21 spare engines from GE Aerospace and CFM International and a 15-year engine maintenance agreement covering 28 aircraft.
The air carrier highlighted that the investment would support long-term fleet expansion following its integration of Asiana Airlines and help improve fuel efficiency as it transitions to newer aircraft models.
The decision was first unveiled during South Korean President Lee Jae-myung's visit to Washington last year.
According to a previous statement by Korean Air CEO Cho Won-tae, the newer aircraft would help Korean Air expand to more destinations in the United States and Latin America, and about 80% of the jets would replace existing aircraft in the carrier's fleet.
The CEO said the completion of the agreement was a major milestone and added that the purchase was an instrumental part of the US-South Korea.
Boeing said the deal resulted from bilateral trade discussions.
(With inputs from Reuters)
