Israeli carrier Arkia Airlines Ltd. is in talks to buy four Boeing 787 Dreamliner aircraft for $280 million. Under the proposed agreement, Arkia will initially buy two aircraft with an option to buy two more.
The Dreamliner aircraft is due begin flying commercially in 2008. Deliveries to Arkia are expected to begin in 2012, but Boeing said it would make every effort to bring delivery forward.
Arkia’s plan to buy the aircraft runs contrary to the accepted practice in the aviation market, which usually opts for leasing arrangements. The agreement will be signed by Arkia managers and the Nakash group during a visit to Boeing (NYSE: BA) at the end of this month.
Arkia will continue, in the meantime, to expand its destination range in 2007 and will acquire a fleet of wide-bodied aircraft under a leasing agreement for this purpose. There is currently a shortage of aircraft worldwide, due to the halt in orders by airlines in the aftermath of the September 11, 2001 terror attacks.
Arkia owner Avi Nakash said the acquisition represented an important stage in the airline’s strategy to become the leader in Israel’s aviation market and integrate into the global market. He added that the acquisition of the new aircraft paved the way for Arkia to apply for designated carrier status for routes to the US, Europe and Asia. Arkia currently operates as a charter company, primarily on European routes.
The Boeing 787 is the company’s most advanced model wide-bodied aircraft. It has a seating capacity of 300, 36 in the business class section and 262 tourist class seats. The aircraft is designed for long-distance flights to destinations as the US West coast, Japan, South America and others. It is also considered economical for use on medium-distance routes in Europe, Africa and West Asia.
Arkia’s current fleet consists of two Boeing 757 300 aircraft, a Boeing 757 200, four ATR 72-500 aircraft and five De Havilland Dash 7 aircraft.
Published by Globes [online], Israel business news - www.globes.co.il - on May 15, 2006
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