Boeing Wins $36Bn Deal From Turkiye's Pegasus
Date
12/19/2024 2:01:59 PM
(MENAFN- Gulf Times) Boeing Co won an order valued at $36bn from Pegasus Hava Tasimaciligi AS, in its biggest commitment so far this year that deals a blow to rival Airbus SE, previously the preferred choice for the Turkish low-cost airline.
The carrier has firm orders for 100 of the as-yet uncertified 737 Max 10 model that it will begin receiving in 2028, with options for another 100, it said in a stock exchange filing. The total value of the agreement assumes that all options are converted, though customers typically negotiate steep discounts for large deals.
The accord, the largest order in Pegasus's history, is an important win for Boeing as it works to overcome the fallout from a prolonged strike and a near-catastrophic accident at the start of the year. For Pegasus, the deal marks a strategic reversal after the carrier said less than two years ago that it wanted to become an all-Airbus operator.
The long-delayed 737 Max 10 is the largest variant of Boeing's popular single-aisle family, and carriers including United Airline Holdings Inc and Virgin Australia have switched out some of their orders for the model due to uncertainty about when it will be certified.
Boeing now expects the Max 10 to be certified in 2025, years behind schedule, as the US manufacturer grapples with tougher regulatory scrutiny and redesign of the jet engines anti-ice system.
Pegasus said in 2023 that it was working on a fresh aircraft order to expand and go further afield into destinations in North Africa and the Baltic states. The carrier has a fleet of more than 100 planes, including 16 older 737 NGs and the rest made up of Airbus A320 family jets, according to its website.
Guliz Ozturk, chief executive officer of Pegasus Hava Tasimaciligi AS The airline also has outstanding orders for another 53 A321 jets, according to Airbus's tally. So far this year, Boeing has received 427 gross orders, and the company has a backlog for the Max 10 variant of 1,109 units.
Turkiye has ambitions to turn itself into a bigger tourism and business hub, using its new Istanbul airport as a global airfield. Pegasus operates from Sabiha Gokcen airport, Istanbul's second hub, which recently opened a second runway.
The deal also stands to deepen corporate and political ties between the two countries. Pegasus said the order will“open new doors and create production and export opportunities both for Turkish manufacturers and for the wider aviation industry,” implying that local companies and industries stand to share in some of the value chain.
Airbus has also gained an important foothold in Turkiye, winning an order for 220 aircraft a year ago from flag carrier Turkish Airlines that consisted of 150 A321 narrow-body jets and 70 of the A350 widebody.
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