UPS places $5.3 billion order for 14 Boeing 747 cargo jets

Reuters

Published Oct 27, 2016 10:21AM ET

UPS places $5.3 billion order for 14 Boeing 747 cargo jets

NEW YORK (Reuters) - United Parcel Service Inc (N:UPS) said on Thursday it ordered 14 Boeing (N:BA) 747-8 cargo jets, a deal worth $5.3 billion at list prices that potentially breathes new life into an aircraft Boeing had warned it might cancel.

The UPS order, which includes options for 14 more of the hump-backed planes, suggests the freight company expects an upturn in air cargo after years of anemic growth.

"These aircraft are a strategic investment for increased capacity for UPS customers around the globe," Brendan Canavan, president of UPS Airlines, said in a statement released by Boeing.

"The 747-8 will allow UPS to upsize our network in both new and existing markets," he added.

The purchase adds significantly to Boeing's order book in a year in which it and rival Airbus (PA:AIR) have struggled to sell widebody aircraft.

Sales of the 747-8, the latest version of the four-engine plane that first flew in 1969, have been slowing. Boeing has cut production to six a year, and in July warned it might end production of the plane altogether.

Similar-sized two-engine planes that are more fuel efficient have largely eclipsed the 747's passenger mission. Sales have also slowed for Airbus' competing four-engine A380.