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American Airlines firms up orders for 787, 737 MAX
(Reuters) - American Airlines on Monday confirmed orders with Boeing (BA.N) and Airbus (EAD.PA) for hundreds of new planes, including 42 Boeing 787 Dreamliners valued at $8.7 billion at list prices.
The deals update and in some cases finalize orders that were part of a landmark agreement for 460 planes that American signed in July 2011, just months before filing for bankruptcy court protection.
The U.S. airline, a unit of AMR Corp (AAMRQ.PK), said on Monday that it has placed firm orders for 42 of the 787s, with options for another 58. The orders come as the 787 is under federal review of its design and manufacture following a host of incidents in recent months that have raised concerns about the plane's safety.
American, based in Fort Worth, Texas, also said it had firm orders for 100 Boeing 737 MAX planes and 18 of the planemaker's 777 widebodies under restructured purchase agreements, with options to take more of those models.
Those deals notch up American's 777 orders by two planes, and allow American to convert a number of existing orders for 737 NG jets to the more advanced MAX variant.
AMR said the overall number of planes on order had not changed as a result of the new agreements, nor had its commitment to modernize its fleet.
"We're still committed to having the youngest mainline fleet among U.S. network carriers by 2017," said American spokesman Sean Collins.
In the summer of 2011, American announced that it agreed to buy 200 Boeing 737s and 260 Airbus A320s in what it called the largest aircraft order in aviation history. Including purchase options, the total potentially could total increase to more than 900 planes.
The new agreements with Boeing and Airbus are subject to bankruptcy court approval. American entered bankruptcy in November 2011 to restructure and lower its labor costs. It is in talks to potentially merge with US Airways while in bankruptcy, but also is considering exiting on its own.
"The thing that really jumps out to me is that American is finally firming up a good chunk of the 787 orders," said Scott Hamilton an analyst at Leeham Co, an aviation consultancy in Seattle. "Those 787s had never been booked and are going to nicely add to the backlog of the 787s." Boeing currently has about 800 unfilled orders for 787s.
American said the 737 MAX airplanes, equipped with more fuel-efficient engines, will be delivered from 2018 through 2022. Under the updated agreement, American said it will have the option to buy 60 additional MAX planes from 2022 to 2025.
Delivery of the 787s would start in November 2014.
American also said in the filing that it revised a 2011 purchase agreement with EADS (EAD.PA) unit Airbus regarding the purchase of A320 family planes.
(Reporting by Karen Jacobs; Editing by Dan Grebler, Alwyn Scott and Steve Orlofsky)
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