Corrects potential value of Boeing order to $2.67 billion from $2.13 billion in paragraph 13

ATLANTA/CHICAGO - International Lease Finance Corp, the world's biggest plane leasing company, said it will order 100 narrowbody planes from EADS unit Airbus and 33 narrowbodies from Boeing Co , and scrap an order for 10 Airbus A380 super jumbo aircraft.

The orders from the aircraft leasing unit of insurer American International Group Inc are potentially worth $11.2 billion at average list prices. The canceled A380 order, which had been in jeopardy for some time, was potentially worth $3.75 billion.

The orders mark the first for ILFC since October 2007 and are a sign of health for the lease company, which was hurt by the financial crisis that caused the near-collapse of parent AIG. ILFC signed a new $2 billion revolving credit agreement in January, a key step as it considered ordering planes.

AIG executives have said ILFC might eventually be sold.

It's a sign that the leasing activity from one of the industry's top players is back, said Peter Arment, an aerospace analyst with Gleacher & Co. They clearly remain confident about future global capacity requirements.

ILFC's orders for 75 A320neo and 25 A321neo jets are a strong vote of confidence for the upcoming revamped versions of the best-selling A320 family. The planes will feature new engines that offer greater fuel efficiency.

The orders may put new pressure on Boeing, the world's second-largest commercial plane-maker, as it decides whether to rebuild or re-engine its 737.

It does speak to the need for a re-engine, especially as the A380 was scrapped and (ILFC) went for shorter-haul jets, said Alex Hamilton, managing director of EarlyBirdCapital.

Boeing has said it is leaning toward building an all-new version of its 737, but has not made a decision. A re-engined plane would be brought to market quicker than a new plane, but would offer less fuel savings.


The new Airbus order is a memorandum of understanding, meaning it is not yet a firm order. The Boeing deal for 33 737-800 aircraft is a full purchase agreement.

ILFC had been reevaluating the order for A380s, a model which was delayed around three years by production problems. ILFC is the largest customer for Boeing's upcoming 787 Dreamliner, which is nearly three years behind schedule.

The agreement with Airbus is potentially worth $9.04 billion based on average list prices and includes 75 A320neo planes and 25 A321neo aircraft.

The Boeing order has a value of $2.67 billion based on average list prices. Earlier on Tuesday, Air China Ltd<601111.SS> <0753.HK> and China's Hainan Airlines Co Ltd <600221.SS> announced plans to buy Boeing aircraft worth $10 billion at list prices.

Shares of Boeing were up 2.0 percent at $72.31 on the New York Stock Exchange, while EADS shares closed up 2.8 percent in Paris at 19.84 euros.

(Reporting by Karen Jacobs and Kyle Peterson, editing by Maureen Bavdek and Gerald E. McCormick)