Air Canada Orders Boeing Jets

Boeing Co. won an order valued at as much as $6.1 billion from Air Canada for 32 jetliners.

Air Canada is buying 18 777s and 14 787s. It also placed options for 18 additional 777s and 46 more of the 787, which is scheduled to enter service in 2008, the Montreal-based airline said in a statement Monday.

The order is Boeing’s first from Air Canada, a unit of ACE Aviation Holdings Inc., since 1989 and the second-biggest for the 787.

The operating costs of the 787, known as the Dreamliner, are expected to be about 30% less than the 767s they will replace.

Boeing is counting on the 787, the company’s first new line of jets in 15 years, to help it regain the position as the world’s leading maker of jetliners from Europe’s Airbus, which has yet to receive approval from its board to begin production on a model that would compete with the 787.

Fuel accounted for about 18% of Air Canada’s operating costs in 2004. The cost of jet fuel has climbed 56% in the last year.

The twin-engine 787 is designed to replace Boeing’s 757s and 767s. It will be able to carry as many as 289 passengers and is expected to be 20% more fuel-efficient than older jets.

The extensive use of carbon fiber composites is expected to make the 787 considerably lighter than the airplanes it will replace.

Boeing has firm orders for 64 787s, the largest for 50 from Japan’s All Nippon Airways Co. The Chicago-based aerospace company said April 6 that it had deposits on 250 of the Dreamliners.

The market for 250-seat jets is worth about $12 billion a year and is dominated by Airbus. Airbus parent European Aeronautic, Defense & Space Co. is looking for board approval to build a new aircraft, called the A350, to challenge the 787. EADS is based in Munich and Paris.

Shares of Boeing rose $1.70 to $59.58 on the New York Stock Exchange