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Iran Says It Will Pay Half Price For Boeing Planes

Iran's national carrier IranAir and Boeing signed an agreement for the purchase of 80 airplanes earlier this month (file photo)

Iran has said it will only pay half of the price announced for 80 new planes from U.S. firm Boeing.

Iran's official IRNA news agency quoted Deputy Transport Minister Asghar Fakhrieh Kashan as saying the country will only pay half of the $16.6 billion deal because of reduced purchasing options.

"Boeing has announced that its IranAir contract is worth $16.6 billion," Kashan was quoted as saying on December 25. "However, considering the nature of our order and the available options, the purchase contract for 80 Boeing aircraft is worth about 50 percent of that amount,"

Boeing did not immediately comment. The firm had earlier said that the value of the deal was based on list prices, though customers typically negotiate discounts for large orders.

Iran’s national carrier IranAir and Boeing signed an agreement on December 11 for the purchase of 50 narrow-bodied 737s and 30 long-range 777s.

Boeing and its European rival Airbus have both signed lucrative contracts this month to supply airliners to Iran, a boost for an Iranian economy hobbled by years of sanctions.

On December 22, Airbus and IranAir finalized a deal for 100 planes worth $18 billion dollars. The contract includes single-aisle A320 and A330 jets and wide-body A350 XWB planes, which are expected to be delivered starting early next year.

Both deals were made possible by the nuclear deal Iran negotiated last year with world powers, enabling them to lift sanctions in exchange for Iran curbing its nuclear activities.

In September, the U.S. Treasury Department granted permission to Boeing and Airbus to sell billions of dollars’ worth of aircraft to Iran.

Most of Iran's aging fleet of 250 commercial planes was purchased before the 1979 revolution, and only about 162 are still in operating condition.

Iran says it intends to buy 400 new planes over the next decade.

With reporting by AP and Reuters
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