Boeing confirms talks with Iran on aircraft sale

News of the deal came from Iran’s minister of roads and urban development, Abbas Akhoundi, who was quoted by Iranian news agencies on Tuesday as saying that an agreement with Boeing had been completed. Its civil aviation fleet has 140 aircraft, with an average age of around 20 years, and many are in desperate need of replacement.

Carrier Iranair will purchase more than 100 Boeing jets from the manufacturer and from leasing companies, though other details of the agreement are vague, Reuters reports.

A report on CNN Money went on to add, “In addition to formal government approval, the deal faces other potential stumbling blocks related to US sanctions that remain in place following the nuclear deal stuck by Tehran and Washington in January”.

A Boeing spokesman told Reuters the company was “engaged in discussions with Iranian airlines approved by the USA government about potential purchases of Boeing commercial passenger airplanes and services”. Media reports said details on the agreement would be announced in the next few days. But it would still have to receive approval from the USA government.

In addition to formal government approval, the deal with Iran faces other potential stumbling blocks related to USA sanctions that remain in place following the nuclear deal stuck by Tehran and Washington in January.

Boeing is studying the passenger plane needs of Iranian airlines. Because more than 10 percent of the parts used on Airbus’s planes are sourced from the USA, the OFAC must also approve this deal. Finally, Israel, which has been doing business with Boeing for more than 60 years and which is a vocal opponent of the nuclear accord, could find fault with the the aerospace giant courting business in Iran. Although many USA sanctions remain on direct business with Tehran, aviation, a major source of US exports, was one area where an exemption was granted. Many big banks got slapped with US fines for doing business with Iran during the period before sanctions were lifted.

The agreement terminated all nuclear-related sanctions imposed on Iran.

But the primary USA trade embargo targeting Iran remains in place. “This deal would be in line with what we expected when we negotiated the deal”, he said, “and it is what the Iranians were expecting when they paid in nuclear dollars for the sanctions relief they got”. Iranair agreed in January to buy 118 jets worth $27 billion at list prices from Airbus.

The Boeing deal could face some political backlash.