New Korean Airline Gives Boeing $1-Billion Order
A new South Korean airline with plans for service to Europe and North America announced Monday a deal worth about $1 billion to buy nine Boeing Co. jetliners and take options on seven more.
Including the new agreement with fledgling Asiana Airlines, Seattle-based Boeing has announced orders for 110 jetliners worth $8.7 billion so far this year.
Asiana, based in Seoul, began operations within South Korea on Dec. 23. It said it will use its new jets to expand to other Asian markets and eventually to North America and Europe.
Asiana ordered five 737-400s and took options for another five. It also signed letters of intent to order two 747-400 jumbo jets and take options for two more, and to convert two previous options for widebody 767-300s to firm orders.
A 747-400, the world’s largest passenger jet, sells for $116 million to $136 million, depending on configuration and equipment, Boeing said. The smaller 737-400 twin-jet sells for $31 million to $36 million, while a widebody 767-300 goes for $66 million to $73 million.
“In the short term, we could have saved a few dollars by buying or leasing older planes,” S. Y. Park, chairman of Kumho Business Group, Asiana’s parent company, said at a news conference.
“However, a new airline has enough problems establishing its market base without the burden of heavy maintenance responsibilities and the uncertainty of whether older planes will perform reliably.” Park said other aircraft manufacturers had talked about selling planes to Asiana, “but at first, others didn’t take us seriously. Boeing did take us seriously.”
J. F. Chorlton, a Boeing vice president, said Asiana had indicated an interest in Boeing aircraft as early as a year ago. He said Boeing had made room on its production line for the planes before the order was announced.