Boeing lands largest-ever 767 order in deal with FedEx

Ben Mutzabaugh | USA TODAY

Boeing landed its largest-ever order for Boeing 767s with a deal from FedEx that was announced Tuesday evening.

The cargo and package delivery company placed a firm order for 50 767-300F freighters with options for 50 additional 767s. The firm portion of the order would be worth nearly $10 billion at list prices, though big customers typically get substantial discounts.

Factoring in "standard discounts" based on pricing data from aircraft valuation firm Avitas, The Seattle Times estimates the order to be worth about $4.2 billion.

The Times notes FedEx "has historically bought airplanes cheaply nearing the end of their production life," suggesting the company "likely got an even better deal" with an order that extends a lifeline to the 767.

"I will only say, the terms are very favorable," FedEx spokesman Jess Bunn tells the Times.

The 767s from the order announced Tuesday are expected to be delivered to Memphis-based FedEx starting in 2017 and running through 2023.

For Boeing, Bloomberg News says "the order gives new life to the 767, which was developed in the 1980s and pioneered long-range flights for twin-engine jets. FedEx Express, the world's biggest cargo airline, is the last remaining customer as passenger carriers shift to newer aircraft" like Boeing's 787 Dreamliner and Airbus' A350 and A330 models.

Though passenger airline prospects for the 767 remain dim, Reuters writes the FedEx deal allows Boeing "to extend its (767) production line well into the next decade."

Prior to the new FedEx order, The Wall Street Journal says the 767's "future was largely earmarked as an aerial refueling tanker for the U.S. Air Force, the development of which Boeing is now struggling to complete."

The Associated Press notes Boeing currently "is producing the jet at the sloth-like rate of 1.5 new planes a month. The 737, its most popular model, has a production rate of 41.5 new jets a month." Boeing expects to bump the 767 rate to about 2 a month in 2016.

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