Boeing Sees Jumbo-Jet Sales Drought Ending on Silk Way AgreementJulie Johnsson
Boeing Co. is nearing an agreement to sell three 747-8 freighters to Azerbaijan’s Silk Way West Airlines, a deal that would end a drought in purchases of the humpbacked jumbo jet.
Completing the transaction would be a boost for Boeing’s biggest, most-expensive model after 2014 ended with no net orders. That was the first annual shutout since the four-engine plane became available in 1966, according to data compiled by Bloomberg.
The companies are working toward a purchase agreement that would be valued at $1.1 billion at list prices, Chicago-based Boeing said today in a statement, without giving a projected timetable. Azerbaijan news media outlets reported earlier that the transaction was final.
Boeing has struggled to land orders for the 747-8, which debuted in 2011. It’s the latest version of the aircraft that opened up intercontinental travel to a mass consumer market in the 1970s and 1980s. Last month, Boeing said it will cut monthly 747 output to 1.3 by September from the current 1.5.
Silk Way West is a unit of Baku-based Silk Way Holding, which includes 23 companies working in the aviation industry and related services. The airline took delivery of two 747-8 freighters in 2014 and operates five other Boeing models.
Boeing has just 36 unfilled orders for both passenger and cargo versions of the jumbo, according to its website. They retail for $367.8 million and $368.4 million, respectively, before the discounts that are customary in the industry.
Jumbo sales have tapered as the air-cargo market proved slow to rebound from the 2008 global recession and airlines shifted long-distance travel to more-efficient twin-engine models such as Boeing’s 777 jetliner.