Boeing (NYSE:BA) had a good week. It won a new logistics contract in Korea, received orders for twin engine jets from Pakistan Airlines and also completed few scheduled deliveries ahead of time for the U.S. Navy. Boeing principally competes with other global jet manufacturers like Lockheed Martin (NYSE:LMT), Northrop Grumman (NYSE:NOC) and Airbus (EPA:EAD). We have a $91 price estimate for Boeing.
Bagged Performance Based Logistics Contract for Sustaining Korea’s F-15Ks
Korea’s Defense Acquisition Program Administration (DAPA) has given Boeing a PBL (Performance Based Logistics) contract to ensure long-term, affordable sustainment of the Republic of Korea Air Force (ROKAF) fleet of F-15K fighters. This approach will ensure that the F-15K4s remain operationally ready for years to come while having low overall life-cycle cost. The five year contract is approximately worth $300M and will also include Hyundai Glovis as the provider of in-country logistics and handler of supply chain distribution activities. This is a combination of Boeing’s expertise in long term PBL solutions and Hyundai Glovis’s expertise in logistics to ensure that ROKAF has the right parts at the right place and the right time.
Got order from Pakistani Airlines for Five 777-300ERs aircraft
Boeing has bagged a firm order from Pakistani Airlines for five 777-300ER (extended range) airplanes which are valued at nearly $1.5 billion at list prices. This order also includes purchase rights to Pakistan International Airlines for five additional 777-300ERs. This is part of Pakistani Airlines effort to renew their long haul fleet to accommodate increased passenger demand and introduce new routes. Last year was the best year for 777 family of aircraft as the total order book for the year exceeded 200. The second best year was 2005 when the orders numbered 154.
Completed Multi-Year Procurement II Deliveries Ahead of Schedule for U.S. Navy
Boeing completed the delivery of 257 F/A-18E/F Super Hornet strike fighters and EA-18G Growler electronic attack aircraft to the U.S. Navy. Each aircraft was delivered ahead of schedule and within the contract budget. This was a multi-year contract in which the aircraft were delivered from 2007 through 2011. The initial contract including delivery of only 210 aircraft was awarded to Boeing in 2003. To this contract, 47 more planes were added in 2009 including 24 F/A-18Fs acquired by the Royal Australian Air Force under a Foreign Military Sales agreement with the U.S. Navy.