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UPDATE 4-American Airlines bets on supersonic travel with Boom jet deal

·2 min read

(Adds comments from CEO interview, analyst comment)

By Nathan Gomes

Aug 16 (Reuters) - American Airlines Group Inc on Tuesday agreed to buy up to 20 jets from aircraft maker Boom Supersonic, becoming the second major U.S. airline to bet on ultra-fast passenger travel in the last two years.

The deal brings Boom's orderbook to 130 airplanes, including options, valued at about $26 billion, Boom Chief Executive Blake Scholl said in an interview.

The return of interest in supersonic jets comes nearly two decades after Concorde, flown by Air France and British Airways, was retired following a deadly crash and high costs of fuel and maintenance.

Last year, United Airlines Holdings Inc agreed to buy 15 Boom Overture aircraft provided they meet certain safety, operating and sustainability requirements. A similar condition was part of the American Airlines agreement as well.

American also has an option to purchase 40 more of the jets, each of which can carry 65 to 80 passengers, the companies said.

The four-engine Overture jet can fly from Miami to London in just under five hours, cutting the nearly nine-hour flight time between the cities by about half.

American Airlines spokesperson Matt Miller said it was too early to discuss ticket prices, given the aircraft isn't expected to carry its first passengers until 2029.

Supersonic jets have come under criticism from environmentalists for burning more fuel per passenger than comparable subsonic planes.

The Overture jet, being designed to run fully on sustainable aviation fuel or a blend, will be rolled out of Boom's Greensboro, North Carolina factory in 2025, followed by test flights in 2026.

Third Bridge senior analyst Christopher Raite sounded a word of caution on Boom's delivery target, saying the delay in conducting test flights for Boom's other jet, the XB-1, signaled that delivery of the Overture will be delayed. (Reporting by Nathan Gomes in Bengaluru and Rajesh Kumar Singh in Chicago; Editing by Vinay Dwivedi and Devika Syamnath)