Qatar Airways confirms major Boeing order

Under-fire aircraft manufacturer Airbus has been dealt another blow, after Qatar Airways confirmed plans to take delivery of a further 20 Boeing 777s. The airline will run 40 Boeings in total.

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By  Barbara Cockburn Published  October 10, 2006

Under-fire aircraft manufacturer Airbus has been dealt another blow, after Qatar Airways confirmed plans to take delivery of a further 20 Boeing 777s. The airline will run 40 Boeings in total. “We placed a firm order for the first 20, but we are planning to buy 40 all together,” Qatar Airways CEO Akbar Al Baker revealed, scotching concerns that the US$4.9 billion deal had been aborted, after Boeing removed a press release for the order from its website earlier this month. The fears had been exacerbated after the airline cancelled a press conference to announce the deal, at the Farnborough Air show. “We cancelled the press event as negotiations for the deal had not been concluded at this point, and we do not like to make announcements until every detail of the transaction is fully worked out,” Al Baker continued. “Now we can confirm the order of the [initial 20] Boeing 777s, with the first one being delivered in November 2007 and the completion of the order scheduled for 2010.” Al Baker denied claims that the introduction of Boeing to the formerly exclusive Airbus fleet was politically motivated. He stressed that the move was entirely based on economical considerations. “We are among the fastest growing airlines worldwide, with a growth rate of 35%. To launch some Boeing planes is a financial necessity for our carrier, since the American plane has its advantages, and Airbus has others,” he explained. “We were a solely Boeing fleet until 1997, after that we converted to Airbus and now we are keen to operate Boeings again. We have also ordered a large number of Airbus A350s, and we certainly need both models to serve our large expansion plans.” The move to introduce Boeings into the Qatar Airways fleet is reflective of a general industry trend towards the US-manufactured planes. In the first half of 2006, Airbus sold 117 mainly single-aisle aircraft, as opposed to 276 in the same period of the previous year. Rival Boeing has listed 480 orders in the same period this year. Qatar Airways announced, at the Paris Air Show in June last year, plans to buy up to 80 new aircraft - 60 A350s and 20 Boeing 777s - in an order worth over $15 billion. The airline plans to more than double its fleet size from 48 planes today, to 110 in 2015. Qatar Airlines is Airbus’ biggest customer in the Middle East. The carrier also has an order for two of the troubled ‘superjumbo’ A380s – the world’s largest commercial plane with a passenger capacity of 555 - which has been experiencing severe technical problems and hence unforeseen delivery delays. That order is worth $1.2 billion, with the planes scheduled for delivery in 2009. “Since the jumbos are to be delivered three years from now, we do not know yet how much they will be delayed, or if they will be late at all,” said Al Baker, who discounted the prospect of legal action against the manufacturer. “We will seek an amicable solution with the manufacturer,” he said. “Also I do not believe that Airbus can afford to have legal actions taken against them.” In June, Airbus announced fresh delays to the deliveries of the A380, with parent company EADS saying that this could cut earnings between 2007 and 2010. “We had an industrial delay. It will shift the programme to the right by six to seven months,” John Leahy, Airbus CEO, told Reuters. He added that the company would still be able to certify the plane and deliver its first order to Singapore Airlines by the end of 2006, but deliveries in 2007 would be cut to nine from an original target of 25. Airbus said in a statement that the latest setback to the delivery was due to wiring problems.

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