Singapore Airlines Ltd. on Friday announced an order for 54 Boeing Co. aircraft valued at US$4.9 billion, its biggest single purchase in six years, for regional unit SilkAir, which operates jets from Boeing rival Airbus.
The commitment comprises 23 single-aisle 737-800 planes and 31 737 MAX-8s, but the carrier has the option of switching to other variants of the aircraft if needed, Singapore Airlines said in a statement to Singapore Exchange. The unit also has the option of increasing the order by 14 jets.
The order is a significant win for Boeing, which has spent the past year establishing its new 737 MAX in the market, and captures a long-time Airbus customer.
Singapore Airlines is hoping regional carrier SilkAir and low-fare unit Scoot will help drive earnings growth, as Singapore's flagship carrier faces stiff competition in its own premium market. Singapore Airlines last month reported a net profit of 78 million Singapore dollars ($63 million) for the April-to-June quarter, recovering from a net loss in the previous quarter.
The company's Boeing order is its biggest single order since 2006, when it ordered 20 Airbus A350s and nine A380 superjumbos valued at $7.5 billion. That year, the company also ordered 20 Boeing 787 jets valued at $4.5 billion. Its last major order was last year, when it reported a deal to buy eight Boeing 777-300 ER jets valued at $2.3 billion.
SilkAir will begin receiving the 737-800 single-aisle jets in 2014, with deliveries continuing into 2021, the statement said.
"We continue to see very strong growth within the region and these new aircraft will position SilkAir well. They will enable us to spread our wings to even more destinations and increase capacity on existing routes," said Mervin Tan, chief executive of SilkAir.
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