DUBAI (Reuters) – Dubai Aerospace Enterprise (DAE), one of the world’s largest aircraft lessors, is in talks to buy a near-record total of 400 jetliners from Airbus and Boeing, its CEO told Reuters, in a $40 billion blowout that would match the order pipeline of rivals.

The move comes months after a leading U.S. airline investor orchestrated a record deal involving more than 400 planes from Airbus as economists project strong growth for air travel, led by the continued expansion of budget carriers.

Airbus and Boeing have sold thousands of the latest versions of their workhorse single-aisle jets in recent years, but the order cycle is slowing down. However, the boom has left long waiting times for jets for remaining potential buyers like DAE.

The government-controlled Dubai firm is interested in buying single-aisle Airbus A320neo-family and Boeing 737 MAX planes after its acquisition last year of Dublin-based lessor AWAS, Chief Executive Firoz Tarapore said on Thursday.

Any deal would not necessarily be evenly split between the two planemakers, Tarapore said, adding DAE was “nowhere near where we thought we would be” in finalising an order.

“We are not happy with the price,” he said in an interview at DAE’s offices in Dubai’s financial district.

Shares in Airbus closed up 1.7 percent, roughly trebling gains seen before the order comments. Boeing shares rose 0.7 percent in early New York trading, outperforming a flat market.

Both companies declined to comment.

An order for 400 single-aisle jets would be worth more than $40 billion at list prices, though discounts of at least 50 percent are common for large orders, say market sources.

It would also give DAE a long-term pipeline of directly ordered jets on a par with its rivals, though the world’s two largest planemakers say they are mostly sold out until 2024.

Reuters

Photo Rob Vogelaar