By Sophie Yu and Brenda Goh
BEIJING (Reuters) -China Eastern Airlines said on Thursday it will buy another 100 C919 airplanes in a deal worth $10 billion at list prices, in what would be the largest ever order for the jet made by the Commercial Aircraft Corporation of China (COMAC).
The state-owned carrier said it had received a “substantial discount” for the deal and that the planes will be delivered in batches from 2024 to 2031. The list price for the C919 is $99 million but aircraft can be sold at discounts of up to 50%, especially for new models.
The deal comes five months after the Chinese passenger plane, developed by state-owned COMAC to rival Airbus SE (OTC:)’s A320neo and Boeing (NYSE:) Co’s 737 MAX single-aisle jet families, took its first flight in May with China Eastern.
The Shanghai-headquartered, state-owned carrier is the first user of the C919 and has bought five of the jets, of which three have been delivered. The other two are expected to be delivered later this year.
Boeing is still waiting to resume deliveries of its bestselling 737 MAX to Chinese airlines more than four years after they were halted following two deadly crashes. The company has been all but shut out of new orders from Chinese carriers since 2017 amid rising political and trade tensions between Beijing and Washington.
Li Hanming, an independent aviation industry analyst, said the deal stemmed from a previous order of intent.
“It is announced at the one year anniversary of C919’s receiving its type certificate,” Li said.
“COMAC has made a good start in the delivery of C919 so far. Next, the plane manufacturer will cooperate with China Eastern more closely, to show other potential users the reliability and performance of C919.”
China Eastern said that the additional planes would add to its fleet at a time when air travel is seeing a strong recovery following three years of COVID curbs, and as the airline needs to retire a large number of its narrow-body aircraft due to their age.
The airline said it would pay for the purchase in installments via its own funds, bank loans and bond issuance.
China Eastern will get delivery of five aircraft in 2024, while ten are to be delivered each year from 2025 to 2027. From 2028 to 2030, 15 C919s will be delivered each year, and the last 20 jets will be delivered in 2031.
Last week, GallopAir, a new Brunei-based airline, said it had signed a letter of intent to purchase 30 aircraft from China, worth $2 billion in total. The deal includes 15 orders of COMAC’s ARJ21 aircraft and 15 of the C919.
($1 = 7.3035 renminbi)
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