The Air Force, which has been looking for ways to lower the cost of new Air Force One planes, agreed Friday to buy two jumbo jets from Boeing that were ordered but never delivered to a now-defunct Russian airline.
Two people close to the matter confirmed earlier this week that the Air Force and Boeing were in talks about the two planes that were still in the company's inventory. They spoke on condition of anonymity because the deal hadn't been publicly announced.
Continue Reading Below
The contract details, including costs, were not provided on Friday. But President Donald Trump has complained about the high cost of new presidential planes, even threatening at one point to cancel the order.
"This award is a significant step towards ensuring an overall affordable program," said Darlene Costello, the Air Force's principal deputy assistant secretary for acquisition. "As we move forward, we will continue to seek and implement cost savings opportunities."
The list price for a Boeing 747-8 is $386.8 million, according to Boeing's website. It was not clear whether that price would apply to planes that are already built and sitting in Boeing's inventory. Modifications to accommodate security, communications and other presidential requirements would have to be done, and would increase the final price.
Last December Trump complained on Twitter about the cost of new Air Force One planes. "Costs are out of control, more than $4 billion. Cancel order!" the president-elect tweeted.
A month later, Boeing CEO Dennis Muilenburg met with Trump and declared they had made "great progress" in discussions about holding down the program's cost. That led to talks between the company and the Pentagon.
The two Boeing 747-8 aircraft were ordered by Russian carrier Transaero but never delivered because the airline filed for bankruptcy protection in 2015, according to the people familiar with the matter. Aircraft makers like Boeing and Airbus routinely try to resell planes that are ordered but never delivered.
The aircraft are expected to be in service in 2024.