Boeing has secured a smaller than expected tentative sale of a further 10 737-700/800s to China Aviation Supplies (CASC), while firming up the final allocation to carriers of the 50 aircraft ordered by Beijing last October.
The latest deal involves a letter of intent (LoI) to order an incremental batch of 10 737s, which is expected to be cemented by the end of the year. The sale is valued at $400 million and is understood to include a minimum of five more -800s for Air China. Regional operator China Southwest Airlines is hoping to take the rest, with deliveries targeted for about 2001-2.
China, in line with past practice, timed the announcement to coincide with US President Bill Clinton's state visit to the country. CASC had been expected to order up to 50 new aircraft, but this was scaled back considerably in the light of recent falling airline traffic figures and financial losses. Beijing made use of the occasion to reconfirm officially the $800 million purchase of 16 737-400/ 700/800s and one 747-400, which formed part of the previously announced deal for 50 Boeing jets. The final allocation of these aircraft include two more 737-800s for Air China and the first -700s for Shanghai Airlines, Shenzhen Airlines and Xinjiang Airlines.
While Air China will get another 747-400, the 29 June LoI did not include an anticipated order for six -400 passenger and combi aircraft for China Eastern Airlines. Boeing is still negotiating a sale to the Shanghai-based carrier, which includes four options.
Source: Flight International
