October 24 2017 – Singapore Airlines said today that the signing of a US$13.8 billion order for 39 Boeing aircraft will help it with new growth opportunities, a move that will augur well for SIA as it undertakes a review of its business.
The purchase agreement also includes six options for each aircraft type – which if exercised will enlarge the deal to as many as 51 aircraft, SIA said in a statement to the Singapore Exchange today.
SIA has been under pressure from tough competition from Middle East airlines and budget carriers.
The carrier in July reported an 8.6 per cent drop in net profit for its fiscal first quarter, saying an uncertain global economic climate and geopolitical concerns, coupled with overcapacity in their key markets made for a challenging business outlook.
SIA will announce its fiscal second-quarter results on Nov 7.
Its stock fell 0.5 per cent to S$10.21 in early trading today.
SIA formally signed a firm order with Boeing for 20 777-9s and 19 787-10s at the White House in Washington DC, at a ceremony witnessed by US President Donald Trump and Singapore Prime Minister Lee Hsien Loong.
The order will provide “additional growth and fleet modernisation through the next decade”, SIA said.
“SIA has been a Boeing customer for many decades and we are pleased to have finalised this major order for widebody aircraft, which will enable us to continue operating a modern and fuel-efficient fleet,” said SIA CEO Goh Choon Phong.
“These new aircraft will also provide the SIA Group with new growth opportunities, allowing us to expand our network and offer even more travel options for our customers,” he added.
The 777-9s are intended primarily for long-haul routes and are due for delivery from the 2021/22 financial year. The 787-10s are to be operated on medium-range routes and are due for delivery from the 2020/21 financial year.