During his visit to Bali U.S. President Barack Obama happily presided over a contract signing ceremony between Indonesia’s Lion Air and Boeing Corporation for the purchase of 230 aircraft worth US$21.7 billion.
Sweetening the deal, Lion Air has also taken an option on the purchase of an additional 150 planes worth a further US$14 billion.
Lion Air, an established and important customer of Boeing, currently operates 178 Boeing Next Generate B-737s.
Welcomed news to a faltering U.S. economy, President Obama called the transaction signed in Bali the biggest commercial transaction in the history of Boeing Aircraft.
At the signing ceremony between Boeing and Lion Air at the Grand Hyatt Resort in Bali, Obama lauded the historic importance of the deal for the Chicago-based aircraft maker that employs more than 100,000 people in the United States.
Lion Air which started operations with a single aircraft in 1999, has received financing from the U.S. Ex-Im Bank. Obama said the deal was part of his long-term plan to double the value of U.S. exports.
Lion Air has become Indonesia’s largest air carrier, controlling 38% of the passenger market carrying 20.5 million passengers. Growth is dramatic with 15 million passengers flown by the airline in 2009. Meanwhile, the national flag carrier Garuda carried only 12.3 million passengers in 2010.
Aviation experts in Indonesia are calling on Lion Air to meet the challenges of managing rapid growth in an airline that has received official warnings from the Ministry of Transportation for sub-standard on-time performance below 70%.
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