Finally.....the news we had all been waiting for...
SIA places an order for 31 Boeing planes In a deal worth US$7.35b, it will receive 18 of the 777-300ER planes from 2006 to 2010, with an option to buy another 13
By Christopher Tan
IN WHAT some have seen as another sign of a rosier outlook, Singapore Airlines (SIA) has placed an order for as many as 31 Boeing 777-300ER planes worth US$7.35 billion (S$12.6 billion) - its second major purchase in four years.
Eighteen of the recently introduced aircraft, each capable of taking up to 350 passengers to Europe, will be delivered from 2006 to 2010.
SIA has an option to buy another 13, a decision it will take later, according to SIA spokesman Stephen Forshaw.
He said yesterday that the value of the purchase is based on American aircraft maker Boeing's list price and includes the cost of spare parts.
'We never disclose actual prices of our transactions,' he said.
The purchase is SIA's second major order since 2000, when it inked a US$8.85 billion deal with European consortium Airbus Industries for 25 A380 planes. These have about the same range as the 777-300ERs but can each carry 500 or so passengers.
The first of these super carriers - of which 10 are firm orders - is scheduled to arrive in 2006.
Head of research at Kim Eng Securities, Mr Seah Hiang Hong, was not unduly excited over SIA's latest purchase, saying 'they have made several big orders in the past'.
'They've been expanding steadily,' he said. 'It's all part and parcel of their fleet renewal process.'
The average age of SIA's fleet of 29 Boeing 747s, 55 Boeing 777s and five super long-range Airbus 340-500s is five years.
But other observers viewed the move as a sign of confidence.
'If you don't see your market growing, then you won't buy,' G K Goh's senior analyst Teo Hiang Boon explained.
Mr Teo noted that SIA, among the world's most profitable carriers, had 'long-maintained' that it would increase its capacity by 4-6 per cent a year.
Another analyst, quoted by Bloomberg news agency, said SIA 'obviously expects some pretty heavy traffic'.
Asked about the 2006 delivery of its Boeing 777-300ERs and Airbus 380s, SIA's spokesman Mr Forshaw said: 'We make orders according to our needs.'
SIA said in its statement yesterday that it had not ordered any new short-haul planes, although it had 'sought proposals from manufacturers for suitable aircraft to operate on its regional routes'.
SIA posted post-tax earnings of $259 million for its first quarter this year, versus a loss of $312 million in the same period last year, which was ravaged by Sars.
But industry watchers have raised the possibility of rising oil prices eroding its profitability.
They reckon earnings could shrink by as much as 1.5 per cent for every 1 per cent rise in the price of fuel.
from Straits Times, 26 Aug 2004
This is an excellent news, there was an article of this in Straits times today. Looking forward to see the 773ER in SQ colours. However, I will still rather to fly 4 engine jets over the trans-pacific ocean.