FlyDubai books 54 Boeing planes worth about $4 billion
Dubai's budget carrier, FlyDubai, said yesterday it will acquire 54 Boeing 737-800 [next-generation] narrow-bodied aircraft in a deal worth about $4 billion (Dh15bn) .
The deal includes four aircraft under a lease agreement with Babcock & Brown Aircraft Management for a further four Boeing 737-800s.
With plans of kicking off operations in mid-2009, with assistance from Emirates, FlyDubai's aircraft order of 50 planes is estimated to be valued at $3.74 billion at list prices, according to Boeing.
The US aircraft manufacturer and Emirates said in a joint statement that FlyDubai has substitution rights to convert its 737-800 orders to 737-900ERs (extended range) in future.
According to FlyDubai's Chief Executive Officer, Ghaith Al-Ghaith, the low-cost carrier will have an initial startup capital of Dh250 million. He said FlyDubai will initially focus on regional flights within the GCC and surrounding countries.
Ghaith, however, did not divulge plans for financing the aircraft purchases. "We have not considered any financing plans for the aircraft. We are looking at the best offer," he said.
"Now that we have our aircraft on order, we can move on to the next stage of our development and look forward with anticipation to the start of our scheduled flights in the middle of next year," he added.
The single-aisle configuration 737-800 aircraft is fitted with 189 economy class seats, and has a flying range of 4.5 hours, which will give FlyDubai access to an estimated two billion potential customers, Emirates said in a statement.
This order marks the biggest single order by a Gulf low-cost carrier for the Boeing aircraft, the statement said.
"This aircraft is ideally suited to our core business," said Sheikh Ahmed bin Saeed Al Maktoum, Chairman of FlyDubai.
"FlyDubai will be the first step for a new set of passengers seeking out high-demand tourist destinations in the Gulf states and surrounding countries, while connecting all parts of the world," he said.
FlyDubai, the third low-cost carrier in the Middle East, after Sharjah's Air Arabia, Kuwait's Jazeera Airways and Bahrain Air, is expected to launch operations in mid-next year from the low-cost terminal coming up in Dubai World Central's Al-Maktoum International airport in Jebel Ali.
FlyDubai's operations would be entirely separate from Emirates airlines and Group. The Dubai Government initially formed FlyDubai in March this year. Since then, the airline has been busy putting its team together.
$700m worth CFM engines ordered
The aircraft ordered by FlyDubai are to be powered by CFM56-7B-engines. The engine order is valued at nearly $700 million at list price. The airline will begin taking delivery in 2009 and is scheduled to have all 50 aircraft operating by 2016.
The CFM56-7B is a product of CFM International (CFM), a 50:50 joint company between Snecma (Safran Group) and General Electric Company. "We are delighted to provide the very reliable CFM56-7B engines to FlyDubai for its 50 737 aircraft," said Muhammad Al-Lamadani, CFM's senior executive – Regional Sales for the Middle East, Eastern Europe, and Commonwealth of Independent States (former Soviet Union). "The high reliability and low operating costs of the CFM56-7B-powered 737s will be critical to help this new airline get off the ground. In addition, we will bring the full force of our world-class customer and product support organisation to bear to help ensure the airline has a very smooth startup."
The CFM56-7B engines powering FlyDubai's new 737 aircraft are the Tech Insertion configuration that incorporates advanced technologies that provide operators with lower fuel consumption, lower emissions and lower maintenance costs.
Improved analytic design tools have enabled CFM to optimise the Tech Insertion combustor so that it will provide 25 per cent lower NOx emissions, allowing the engine to meet the new International Civil Aviation Organisation Committee of Aviation Environmental Protection emissions standards.