Brazil's Embraer announced Wednesday it will sell 100 regional jets to China's Hainan Airlines Co. in a $2.7 billion deal, causing shares of the world's fourth-largest aircraft maker to soar in early trading.
Embraer said it will start delivering the 50 E145 and 50 E190 jets in 2007.
The company will make the E145s at a plant in Harbin, China, that opened in 2003, and it will make the E190s at its factory in Sao Jose dos Campos, Brazil.
The deal was announced as China's No. 2 leader, Wu Bangguo, visits Brazil on a trip that will also take him to Uruguay and Chile. Wu is chairman of China's parliament and the No. 2 member of the Communist Party's ruling Standing Committee.
China's government in 2002 committed to buy planes from Embraer in return for a promise by Embraer to build the plant. Brazilian officials have recently pressured China to follow through with the order.
The deal represents "Embraer's long-term strategy to become an important player in the Chinese market," said Embraer Chairman and Chief Executive Mauricio Botelho. Demand for Embraer regional jets has been rising worldwide.
American depository shares of Embraer, or Empresa Brasileira de Aeronautica SA, jumped $1.65, or 4.6 percent, to $37.80 in early trading Wednesday on the New York Stock Exchange, where they have traded between $31.74 and $42.95 over the past 52 weeks.
The E145s carry 50 passengers, and the E190s will be configured for 106 passengers, Embraer said.
The company announced the value of the deal using list prices for each airplane, though carriers frequently receive discounts for large purchases.
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