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Etopian Airlines will significantly expand its fleet with the purchase of 84 new aircraft from Boeing (NYSE and Airbus, as CEO Mesfin Tasew announced today. This move forms part of the airline’s Vision 2035 strategic roadmap, which aims to establish itself as a global leader in aviation. The order consists of a combination of 67 Boeing and 17 Airbus aircraft, which will add to its existing fleet of 140 passenger aircraft. This expansion is expected to bring Ethiopian Airlines’ total fleet size to 271 for the year 2035.
The strategic acquisition is designed to replace outdated models and boost the airline’s presence in the international market. By improving operational efficiency and expanding global route coverage, Ethiopian Airlines anticipates a significant growth trajectory.
In related industry news, during today’s Dubai Airshow, Boeing secured a deal with flydubai for thirty 787-9 Dreamliners. This contract will support flydubai’s development of new routes and increase the capacity of existing routes. Sheikh Ahmed bin Saeed Al Maktoum recognized flydubai’s role in reinforcing Dubai’s status as an international air traffic hub.
Flydubai CEO Ghaith Al Ghaith praised the operational efficiency and passenger appeal of the Dreamliner series, which can carry 296 passengers over distances of up to 14,010 km. With an existing all-Boeing 737 fleet and more orders, flydubai is preparing for anticipated network expansion. Boeing representative Stan Deal said the Dreamliner aligns well with flydubai’s growth plans and offers passengers the unique “Dreamliner effect.”
The Middle East aviation market is expected to double its demand for aircraft over the next two decades, particularly wide-body models, due to their crucial role in connecting international flights.
InvestingPro Insights
In light of Ethiopian Airlines’ expansion strategy, it is worth noting some real-time data and advice from InvestingPro. For Boeing (BA), revenue growth has accelerated, a fact that aligns with Ethiopian Airlines’ ambitious growth plans. However, InvestingPro Tips also highlights that Boeing is currently trading at a high EBITDA valuation multiple and has been noted to be in overbought territory. Investors should take these factors into account when considering the company’s stock.
Airbus (EADSY (OTC:)), on the other hand, has shown a high return on invested capital and has more cash than debt on its balance sheet, according to InvestingPro Tips. This financial stability could be a factor in Ethiopian Airlines’ decision to include Airbus in its fleet expansion. Airbus shares generally trade with low price volatility, which could attract more risk-averse investors.
InvestingPro Data reveals that Boeing’s market capitalization stands at $125.86 billion, with a negative P/E ratio of -44.26. Meanwhile, Airbus has a market capitalization of $113.94 billion and a P/E ratio of 25.91. Both companies have shown significant revenue growth in the third quarter of 2023, with Boeing at 23.34% and Airbus at 14.68%.
It’s worth noting that InvestingPro offers many more tips and data points for subscribers, now available with a special Black Friday discount of up to 55%. This could be a valuable resource for those interested in the aerospace and defense industry, or investing in general.
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