Dubai is taking on airline competitors with $50 billion in aircraft purchases

Dubai's government-owned carriers have placed orders for over $50 billion worth of Boeing jets to secure dwindling supplies of long-haul jets and anticipate growth in international travel. Emirates and flyDubai have ordered 125 Boeing wide-body jets, including 55 of the 400-seat Boeing 777-9 and 35 of the smaller 777-8 models. The orders are a boost for the 777X program, which has been plagued by delays. Emirates has also ordered five extra 787 Dreamliners, while flyDubai has made its first-ever long-haul order for 30 of the same type. The purchases reflect Dubai's commitment to the future of aviation, according to Emirates and flyDubai Chairman Sheikh Ahmed bin Saeed Al Maktoum, who added that Emirates expects to receive the 777X in 2025. Dubai's economy relies heavily on aviation and tourism, making these industries crucial to the emirate's future growth. 


Boeing shares rose 4.4% in New York following the orders, which also included 45 narrow-body jets for German-Turkish airline SunExpress. Bloomberg reported that there are talks this week between U.S. President Joe Biden and Chinese President Xi Jinping, which could end a prolonged freeze on Chinese 737 purchases. The Gulf is the biggest customer for larger wide-body jets due to the favorable location of its UAE and Qatar hubs. However, regional competition is intensifying as Saudi Arabia looks to establish its own footprint, while Turkey and India have plans to draw connecting traffic away from the Gulf. 

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Industry officials estimate that airlines worldwide are in talks to buy 700-800 new jets, including 200-300 wide-bodies, as they catch up on replacement plans set aside during the pandemic. However, there are concerns about whether there is room for all the capacity being explored simultaneously by the region's carriers. Turkish Airlines also made headlines at the Dubai Airshow by announcing that it was in talks to buy up to 355 Airbus jets. Meanwhile, Saudi Arabia's newest airline, Riyadh Air, is still in talks with planemakers to place an order for narrow-body jets, and Saudia Airlines Group is planning to order around 150 narrow-bodied aircraft for Saudia Airline and low-cost Flyadeal. 

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Royal Jordanian's chief executive announced that the airline is seeing a reduction in traffic and having to operate longer routes as a result of the conflict in Gaza. The show brought reminders of the ongoing Israel-Hamas war in Gaza, which has pushed up demand for weapons and closed airspace. Daniel Silke, director of Cape Town-based Political Futures Consultancy, stated that there is enough evidence to show that there has been a substantial drop in ticket sales in the region. Analysts have said that the war in Gaza is also likely to reinforce demand for weapons on top of a surge in the past 18 months as the United States and its allies rearm Ukraine against Russia. However, few major arms deals were expected at the show.

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