Boeing in $10 Billion Freighter Sale to Russia’s Volga-Dnepr
(Bloomberg) -- Boeing Co. sealed a deal to sell 777 freighters with a sticker price of almost $10 billion to Russia's Volga-Dnepr Group, the world's largest carrier of outsize cargo.
Volga-Dnepr signed a letter of intent to buy 29 of the 777s and confirmed a $2 billion order for five 747-8 freighters, Boeing said Tuesday in a statement. The 777F is priced at $339.2 million before customary discounts, while the 747-8 has a list price of $403.6 million.
Moscow-based Volga-Dnepr, known for its fleet of huge Antonov Ruslan planes, specializes in transporting oversize items such as military and oilfield equipment. It ordered a batch of 20 747-8 cargo planes two years ago, helping to extend the life of the hump-nosed jumbo jet. The purchase of the smaller 777s may signal it plans to expand its traditional freight operations as well.
With the Volga-Dnepr announcement, Boeing continues to take advantage of a rebound in air cargo after a slump that hit in 2008. On Monday, the U.S. company announced two deals totaling $6.4 billion for 777 freighters, to package-delivery service DHL and to Qatar Airlines. Boeing has a full lineup of freighters while rival Airbus SE only has one.
Volga-Dnepr is a longtime partner to Boeing, delivering aircraft segments to the U.S. company's assembly plants. Doing business has at times been difficult, given sanctions imposed over Russian aggression in the Ukraine, as well as the more recent indictments arising from alleged U.S. election-meddling. The debate generated by President Trump's meeting with Russian President Vladimir Putin on Monday suggests the controversy will continue.
While the four-engine 747 is winding down as an option for passenger airlines, the freighter version of the humbacked jumbo jet remains a popular choice with cargo specialists. It's bigger than the younger 777 widebody, and has a nose that pivots up, allowing outsize items to be loaded in.
To contact the reporter on this story: Julie Johnsson in London at jjohnsson@bloomberg.net
To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net
©2018 Bloomberg L.P.
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