Hainan Airlines to buy 30 Boeing 787-9 jets, worth $7.7 billion by List Price
Hainan Airlines Co Ltd (600221.SS), China’s fourth-largest carrier, said on Wednesday it plans to order 30 Boeing Co (BA.N) B787-9 jets as it seeks to expand international routes to tap into growing demand for overseas travel from China.
The order would be the biggest this year for the jet, worth $7.7 billion according to list prices. It would also boost the aircraft maker’s 787 program backlog to 855 planes.
China’s airline passengers are increasingly looking beyond the mainland for travel opportunities. In 2014, Chinese travelers made more than 100 million trips overseas in a year for the first time, up sharply from 8.4 million in 1998, official data show.
Hainan Airlines added two long-haul routes to North America and Western Europe last year and plans major international expansion this year, Cai Zhiquan, a brand manager told Reuters. On Thursday. it reported net profit jumped 20 percent in 2014 to 2.59 billion yuan ($417 million).
“We’ll be flying from major hubs in China to second- or third-tier cities overseas,” said Cai. “At the same time, we’ll also open up more routes from inland Chinese cities to major hub cities elsewhere.”
Hainan Airlines will open four long-haul routes in the first half of the year, flying to Rome and San Jose, Cai said. It will also boost services to Boston and Seattle, adding routes to the cities from Shanghai to existing services from Beijing.
Cai said details of the Boeing order are still being discussed. Deliveries are scheduled to start before 2021, he said.
Boeing declined to comment.
The 787 is Boeing’s most advanced plane, with a carbon-composite fuselage and improved fuel efficiency. The 787-9 is a stretched version introduced last year that seats 280 passengers and has a range of 8,300 nautical miles.
Hainan Airlines’ shares, traded in Shanghai, were down 3.7 percent to 4.38 yuan in mid-afternoon trade, well below a 0.51 percent gain in the benchmark index .SSEC.
($1 = 6.2132 Chinese yuan renminbi)
Source: Reuters
