In the midst of financial turbulence in the domestic aviation industry, Jet Airways will be inducting 17 new Boeing 737 aircraft at cost of around $1 billion beginning 2013, on sale and lease-back.
Airline sources said that India?s largest passenger carrier has converted the options on two previous agreements with Boeing into firm orders.
The first is a direct conversion of the option of 10 Boeing 737s as part of deal signed by Jet Airways and Boeing in 2007 when the airline placed an order for 20 Boeing 737s. Airline sources said the airline also converted the wide-body option of 7 Boeing 777-300ER into firm orders for Boeing 737.
On September 12, 2005, Jet Airways had told BSE that it had signed a deal to purchase 10 Boeing 777s with an option for 10 more. In 2007, the airline exercised the option for three more, leaving it with an option of seven more. This has been converted into a firm order for the narrow-bodied Boeing 737, according to airline officials.
Earlier on Thursday, a Boeing spokesperson told the media in Seattle that Jet Airways had firmed up an order of 17 Boeing 737, without giving additional details.
Jet Airways already operates Boeing 737-800s. At list price, the airline would have to shell out around $1 billion for inducting the new aircraft. The airline will receive deliveries of these aircraft between 2013 to 2014, sources added.
?It?s a smart move to convert the aircraft buying option into a narrow-bodied one,? said a consultant with a global audit and tax advisory firm. ?They can run the Boeing 737, which is a fuel efficient aircraft, on international routes like West Asia as well as domestic routes.?
?Since the airline?s focus is more on West Asian routes, it makes sense for them to go for the Boeing 737 instead of Boeing 777, which is larger and ideal for longer routes,? he added.