updated - May 28, 2020 Thursday EDT
A group of Chinese companies have signed an agreement to purchase 300 planes from Boeing Company, according to a report from the official Xinhua News Agency.
Boeing also signed a cooperative deal with Commercial Aircraft Corporation of China Ltd. to build an assembly plant in China for Boeing's 737 aircraft.
Reuters reported that the deal was separately confirmed by ICBC Financial Leasing Co., a unit of the Industrial and Commercial Bank of China.
The company confirmed that it will be purchasing 30 of Boeing's 737-800 jets, worth $2.88 billion at list price.
China, the second-largest economy in the world, is a key market for Boeing and its European rival Airbus Group SE, according to Reuters.
Boeing's forecast China's aircraft demand was raised by 5 percent in August, believing that the country will need 6,330 planes over the next 20 years.
Reuters adds that China Aviation Supplies Holding Company and China Development Bank Leasing are the other two customers for the aircraft.
Aside from selling planes to Chinese companies, Boeing will also be building an aircraft completion center in China, as part of its partnership with Commercial Aircraft.
Bloomberg adds that completion and deliver center of the 737 jets will be the first of its kind for Boeing that is outside the U.S.
The airplane maker's rival, Airbus, already has a similar facility in Tianjin, near Beijing.
Moshin Aziz, an analyst at Malayan Banking Bhd. in Kuala Lumpur, told Bloomberg that there is demand in China right now for planes.
"The emerging middle class in China is helping to boost demand," he said. "Most of the planes ordered will be for growth, and very few will be for replacement."
Xinhua News Agency adds that the deal was reached during the first state visit of Chinese President Xi Jinping to the U.S.
His state visit started on Tuesday morning.
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