Mexican Airline Aeromexico Orders $11 Billion in Boeing Planes

Date : 07/25/2012 @ 10:53AM
Source : Dow Jones News
Stock : Boeing Company (The) (BA)
Quote : 186.59  -0.48 (-0.26%) @ 3:59PM

Mexican Airline Aeromexico Orders $11 Billion in Boeing Planes

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--Order consists of 90 737 Max aircraft and 10 787-9 Dreamliners

--Boeing order on top of acquisitions disclosed in 2011

--Aeromexico has benefited from bankruptcy of main domestic rival

 
   By Amy Guthrie 
 

MEXICO CITY--Mexico's biggest airline operator, Grupo Aeromexico SAB (AEROMEX.MX), said Wednesday it has signed a letter of intent to acquire 100 new planes from Boeing Co. (BA) in a deal valued at $11 billion.

The order consists of 90 Boeing 737 Max aircraft and 10 Boeing 787-9 Dreamliners in what Aeromexico said represents the biggest fleet investment in the history of Mexican aviation.

Aeromexico also said it will be the first airline in Latin America to operate the equipment. The airline expects the 787-9 Dreamliners to arrive in the summer of 2013, while the 737 Max planes should begin to arrive in 2018.

The order is in addition to nine Dreamliners that Aeromexico had already anticipated purchasing and in addition to the acquisition of 10 Boeing 737-8 NGs and 10 Embraer SA (ERJ) 190s disclosed in 2011.

The planes are expected to enable Aeromexico to fly greater distances, while also reducing its maintenance costs.

"This equipment represents a jump in Aeromexico's fleet technology, and will give us one of the youngest and most efficient fleets in the world, significantly reducing the impact on the environment in addition to consolidating the group's fleet into just two types of cabins," Aeromexico Chief Executive Andres Conesa said.

Aeromexico has benefited significantly from increased passenger traffic since the 2010 bankruptcy of its chief domestic rival, flagship Mexican airline Mexicana.

Last year, Aeromexico transported 14 million passengers. The company operates about 600 routes to 45 domestic and 32 international destinations. Atlanta-based Delta Air Lines Inc. (DAL) owns 3.5% of Aeromexico, and the two airlines are members of the SkyTeam global marketing alliance.

Write to Amy Guthrie at amy.guthrie@dowjones.com.

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