General Electric’s multi-billion dollar deals
General Electric (GE) emerged as the winner at the 53rd International Paris Air Show. The company’s aviation business unit, which manufactures aircraft engines, secured record multibillion-dollar deals. On June 20, the company announced that CFM International, a 50-50 joint venture between GE Aviation and France’s Safran Aircraft Engines, wrapped up the show with $55 billion worth of new orders.
The multi-billion deals at the aviation event have broken GE Aviation’s previous record. The previous record was $31 billion at the Paris Air Show in 2017. The new deals were way higher than management’s expectations. In an interview with CNBC, GE Aviation’s CEO David Joyce said that he expects to get deals worth $35 billion at the event.
GE Aviation also outshined Boeing (BA) and Airbus, the world’s two largest aerospace and defense companies, in terms of the value of the deals. Boeing bagged nearly $34 billion worth of contracts, while Airbus secured deals worth ~$44 billion.
GE Aviation booked major orders for its LEAP 1A engines. IndiGo, an Indian low-cost airline, signed an agreement for 280 LEAP 1A engines, which will power Airbus A320neo and A321neo jets. The deal is expected to be worth $20 billion at list price. AirAsia has agreed to buy 200 of the same model engines for $23.1 billion.
Amazon (AMZN) signed an agreement to lease 15 Boeing 737–800 cargo planes from GE Capital Aviation Services—part of GE Aviation. The move is believed to be the company’s latest strategy to expand its air delivery network after FedEx (FDX) dumped it from its cargo services. On June 9, FedEx announced that it wouldn’t renew its deal with Amazon for Express domestic delivery for the latter’s packages.
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