Under the agreement between Boeing and Sace CDP Group, the Italian government agency said it may offer up to $1.25 billion worth of Dream liner jet loan guarantees to airlines around the world this year.
Coming just ahead of the Paris Air Show at Le Bourgeois later this month, Rome-based Sace’s loan guarantee deal is a welcome development for Chicago-based Boeing (NYSE: BA).
No export financing for jet deals is currently being approved by the Export-Import Bank in the U.S. after Republicans blocked them and President Donald Trump threatened to shutter the agency last year.
So far in 2017, Boeing has reported 23 Dream liner sales, though jet makers typically keep bigger deals to announce at the summer air shows and year end.
The financing could help boost sales of Boeing’s flagship, new jet, which has struggled to gain profitability in its early years. Boeing has been shedding jobs in Everett, where the Dream liners are built.
Hainan Air announced that it will purchase 13 Boeing 787-9 (and six 737 Max-8s) in 2018-2019 for an estimated $4.2 billion at list prices, but the China-based airline said it still needs to borrow $2 billion to finance part of the deal.
The Italian export agency said its loan guarantees offer Boeing and the Italian aerospace sector “a shared platform for facilitating the financing of aircraft purchases of mutual interest.”
“The agreement we are announcing strengthens our relationship with an international aerospace giant that has chosen Italy as one of its principal partners,” Alessandro Decio, CEO of Sace CDP Group, said in a news release.
For Boeing, such loan guarantees can mean the difference between completing a big jet deal with an airline or not. But the Italian government has its own interests at play, too.
For More Information: Andrew McIntosh