Hainan Airlines Holding Co. plans to purchase 40 aircraft from planemaker Commercial Aircraft Corp. of China for as much as $1.52 billion combined to beef up its fleet and expand its business.
Under the deal, the Shanghai-listed airline’s low-cost carrier unit Urumqi Air will sign an agreement with Comac, as the Chinese planemaker is better known, for 40 ARJ21-700 jets at $38 million each, according to a filing to the Shanghai stock exchange. The planes are scheduled to be delivered in batches from 2025 to 2032.
Hainan Airlines’ board of directors has approved the deal, which still needs the green light of its shareholders and the Chinese regulators, the airline said. It added it plans to ask for bank loans to help fund the purchase.
The ARJ21-700 is the first short-medium range turbofan regional plane to have been created in China. These planes can seat between 78 and 97 passengers and have a range of 2,225 to 3,700 kilometers. Next month, the Chinese manufacturer will celebrate one decade since the certification of the -700.
In ten years since the plane’s certification, COMAC has manufactured under 200 of the type. According to ch-aviation, there are 148 ARJ21-700s worldwide.
The HNA Group, which is one of the owners of Hainan Airlines, also announced a significant aircraft order in April. At the time, it purchased 60 C919s and 40ARJ21s. The 60 C919s were meant for two of the subsidiaries, Suparna Airlines and Urumqi Air.