Boeing Says China Eastern Orders 20 777 Planes

Boeing Co. (BA) said China Eastern Airlines Corp. (CEA, 0670.HK, 600115.SH, K3CD.SG) agreed to buy 20 Boeing 777, as the airline plans to expand capacity in the Asia-Pacific region and China to meet growing demand.

Financial terms of the deal, which still requires approval from the Chinese government, weren't disclosed. Citing people familiar with the deal, Reuters recently reported that the order was worth $6 billion and was being made as China Eastern was holding back on a $3 billion order for 15 Airbus A330 planes.

China Eastern had recently canceled an order for 24 Boeing 787 Dreamliners, with the carrier swapping out for 45 smaller 737 planes. While the Dreamliner has faced years of delays, the cancellation owed much to China Eastern's refocusing its expansion on domestic routes rather than long-haul international flights.

Boeing has benefited from a global expansion of passenger air travel and a mountain of orders for its best-selling 737 jets. But, the aerospace company has faced challenges from soft U.S. defense spending.

Earlier this week, the company said its first-quarter earnings surged, driven by a continued rebound in its commercial airplane business.

Shares were up 1 cent at $77. The stock is up 5% so far this year.

-By Ben Fox Rubin, Dow Jones Newswires; 212-416-3108; [e-mail]