Airbus, Boeing will sell to Iran

Some analysts are skeptical that Iran has a large enough demand for aircraft, and that it has enough financing

Aviation giants Airbus and Boeing Co have received permission from the US government to sell aircraft to Iran, part of landmark deals potentially worth some $50 billion in total following last year’s nuclear accord.

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European airplane manufacturer Airbus announced the license from the US Treasury’s Office of Foreign Assets Control early Wednesday. Boeing followed with its own announcement later in the day.

Airbus needed the approval of the US Treasury for the deal because at least 10 percent of the manufacturer’s components are of US origin.

Airbus applied for two licenses to cover its deal with Iran to ensure the fast delivery of some of the aircraft, Airbus spokesman Justin Dubon told The Associated Press. The license announced on Wednesday covers the first 17 planes involved in the deal, which will be A320s and A330s, he said.

Dubon said Airbus hoped to receive a second license allowing it to sell the remaining planes to Iran soon.

In January, national carrier Iran Air signed agreements to buy 118 planes from Airbus, estimated to be worth some $25 billion. On Sunday, state TV reported that Asghar Fakhrieh Kashan, a deputy transportation minister, said Iran would cut the number of Airbus planes to 112.

Base model A320s are listed at an average of $98 million, while A330s start at $231.5 million. That puts the value of the approved 17 aircraft in the first license around at least $1.8 billion and possibly much higher based on list prices, though buyers typically negotiate sizable discounts for bulk orders.

Under Boeing’s deal, Iran Air will buy 80 aircraft with a total list price of $17.6 billion, with deliveries beginning in 2017 and running until 2025. Iran Air also will lease 29 new Boeing 737s in a deal that Iranian officials have suggested would be worth some $25 billion in total.

In a statement, Boeing spokesman Marc Sklar said, “We have received that license and remain in talks with Iran Air” based on the memorandum of agreement reached in June.

US Treasury spokeswoman Dawn Selak acknowledged her agency granted the first licenses to Airbus and Boeing.

“These licenses contain strict conditions to ensure that the planes will be used exclusively for commercial passenger use and cannot be resold or transferred to a designated entity,” Selak said in a statement.

The license approval clears the way for the two plane manufacturers to begin accessing one of the last untapped aviation markets in the world, home to 80 million people. However, Western analysts are skeptical that there is demand for so many jets or available financing for two separate $25- billion deals.

The planes will be used exclusively for commercial passenger use and cannot be resold or transferred.” Dawn Selak, US Treasury spokeswomen