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Boeing expected to sell nearly 80 787 planes to Saudi airlines

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State-owned Saudi Arabian Airlines and new national airline Riyadh Air will be acquiring Boeing 787s

Boeing Co. is expected to sell nearly 80 787 Dreamliner airplanes to two Saudi Arabian airlines, a source briefed on the matter said.

An announcement of the plan reported earlier by the Wall Street Journal is expected as soon as Tuesday, and the list prices for 78 planes would total nearly $37 billion. Airlines typically get undisclosed discounts when buying airplanes.

State-owned Saudi Arabian Airlines (Saudia) and new national airline Riyadh Air will be acquiring Boeing 787s, the source said. The airlines are expected to buy a total of 78 787s split between the two buyers and have options to buy another 43, the source said.

Saudi Arabia’s Crown Prince Mohammed bin Salman formally announced on Sunday the creation of Riyadh Air, with industry veteran Tony Douglas as chief executive, as the kingdom moves to compete with regional transport and travel hubs.

Riyadh Air will serve more than 100 destinations around the world by 2030, making use of the kingdom’s location between Asia, Africa and Europe, state news agency SPA said.

The new airline is expected to add $20 billion to Saudi Arabia’s non-oil GDP growth and create more than 200,000 jobs both directly and indirectly, it said.

Riyadh Air is wholly owned by Saudi Arabia’s sovereign wealth fund, the Public Investment Fund, which has more than $600 billion in assets and is spearheading the kingdom’s efforts to diversify its economy and wean itself off oil.

In October, Saudi Arabia was in advanced negotiations to order almost 40 A350 jets from Airbus, while Boeing was also lobbying for a slice of the kingdom’s transportation expansion, industry sources had told Reuters.

The Saudi deal comes on the heels of a major December order from United Airlines for 100 787 Dreamliners and 100 737 MAX jets.

Earlier this month, Reuters exclusively reported that Indian budget carrier IndiGo is in talks with Boeing and Airbus to purchase more than 500 aircraft, an order that had been expanded to include widebody planes such as the 787 or Airbus A330neo.

On Friday, the Federal Aviation Administration announced it would allow Boeing to resume deliveries of the 787 this week that had been temporarily suspended since February.