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Air NZ commits around $2B to buy eight new Boeing Dreamliner 10-series planes

Monday 27th May 2019

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Air New Zealand is committing to buy eight new Boeing Dreamliner 787-10 long haul jets, with options on 12 more, and plans to have the first of the new planes in service by late 2022.

The national carrier did not disclose the price for the aircraft, beyond saying it had negotiated a "significant discount" on the US$2.7 billion list price. The investment will require shareholder approval at its annual meeting in September, although the New Zealand government as 52 percent shareholder has indicated it will support the transaction.

Some 5.5 metres longer than the 787-9 Dreamliner, of which Air NZ has 13 in service for long haul flights, the new planes are also 25 percent more fuel-efficient than the eight Boeing 777-200 aircraft that the new Dreamliners will replace.

And unlike the existing Dreamliner fleet, which are fitted with Rolls Royce engines that have been subject to global product recalls and created significant route management issues for Air NZ, the new planes will powered by GE Aviation GEnx-1B engines.

“The game changer for us has been that by working closely with Boeing, we’ve ensured the 787-10 will meet our network needs, including the ability to fly missions similar to our current 777-200 fleet," said Air NZ chief executive Christopher Luxon. “With the 787-10 offering almost 15 percent more space for customers and cargo than the 787-9, this investment creates the platform for our future strategic direction and opens up new opportunities to grow."

The Dreamliner had proven to be "the perfect aircraft for the airline’s Pacific Rim focus". 

The option to take another 12 Dreamliners under the agreement signed today also includes flexibility to switch from 787-10 to 787-9 aircraft or to take a combination of the two, and allows both delayed and accelerated delivery, according to demand, Air NZ said in a statement. The eighth plane in the current order is scheduled for delivery in 2027.

The investment would ensure that Air NZ "continues to operate one of the world’s youngest and most efficient jet fleets”, said Luxon.

Air NZ's widebody fleet currently consists of 13 Boeing 787-9s, eight Boeing 777-200s and seven Boeing 777-300 aircraft. A 14th Boeing 787-9 will enter the fleet later this year.

The shares were unchanged at $2.72, and have dropped 12 percent so far this year, lagging behind a 16 percent increase in the S&P/NZX 50 Index over the same period. 

(BusinessDesk)

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