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Ocean Carrier Review

Pacific Northwest Ports

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2014 Media Kit
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Korean Air to buy $230 mln cargo plane from Boeing

By: | at 08:00 PM | Channel(s): Air Cargo  

Korean Air said it was buying a cargo plane for $230 million from Boeing Co., following an agreement last month to buy 10 passenger jets from the US firm.

The purchase of the 747-400 ERF (extended range freighter) plane is part of Korean Air’s plans to spend $10 billion for aircraft purchases, inflight service upgrades, information technology enhancements and other projects over the next decade.

Boeing has been turning up the heat on European archrival Airbus as it seeks to grab a bigger slice of the fuel-efficient mid-sized airliner market.

“The order was to make our option attached to a firm order placed last year to buy two 747-400 ERF planes into a firm order,” said Lee Hyung-woo, a spokesman for the Korean firm by telephone.

To finance the new purchase, Korean Air would secure $186 million in 10-year loans, the Korean carrier said in a filing to the Korea Exchange. The plane would be delivered in May, 2006.

Korean Air, the world’s second-biggest air cargo carrier, ordered last year from Airbus five A380s to add to its fleet beginning in 2007.

In a coup for Boeing, however, Korean Air agreed last month to buy 10 787 Dreamliner jets worth $1.3 billion from the US firm, marking a victory for Boeing in the growing mid-sized passenger jet market.

Airlines, many of which are struggling to contain record losses amid surging fuel prices, are striving to find ways to improve operating efficiencies. (Reuters)