Published March 02, 2011
March 2, 2011 – NEW YORK (Reuters) - Bombardier Inc has agreed to sell as many as 120 aircraft to Warren Buffett's NetJets Inc in a deal that could earn it more than $6.7 billion.
The deal, consisting of a firm order of 50 jets and options to purchase a further 70, is the largest business aircraft sale for Bombardier, the world's No. 3 civil aircraft maker after Airbus and Boeing.
While airlines still account for the majority of corporate travel, many businesses are gradually returning to private planes. They are eager to avoid airport hassles, flight delays and other potential logistical snags associated with commercial flying.
Total business jet flights -- privately owned and charter -- rose 7 percent to 2.84 million in the 12-month period through September, with much of the growth seen in overseas travel, according to data tracked by the Federal Aviation Administration (FAA).
NetJets, the corporate aircraft unit of Warren Buffett's Berkshire Hathaway Inc, has placed orders for 50 business jets with a total value of $2.8 billion. If all the options for the additional 70 aircraft are exercised, the total value of the order will surpass $6.7 billion.
Deliveries of these aircraft will begin in 2017, the company said.
Last month, Bombardier said it expects to deliver 150 business aircraft and 90 commercial aircraft in calendar 2011, mirroring its performance in the previous year.
NetJets currently operates a global fleet of more than 800 aircraft.
(Reporting by Soyoung Kim; Editing by Anshuman Daga)