Boeing Unveils New Purchases In Wake of Airbus's Orders
May 17, 2011
Boeing Co. unveiled a another big new order on Wednesday, this one for seven 747-400s valued at $1.18 billion, the latest announcement at the Farnborough Air Show in England. Airplane makers use air shows to hawk their wares, cut deals and also fight for maximum publicity to try to demonstrate they are outdoing their rivals. The shows often turn into public relations duels between the two market leaders, Seattle-based Boeing and Airbus Industrie, the European consortium from Britain, France, Germany and Spain. The new Boeing order from Philippine Airlines is in addition to the $6.3 billion worth of orders it announced at the biennial air show on Monday. The Boeing orders sandwiched Airbus's announcement on Tuesday that it had won firm orders for 32 planes valued at about $2.4 billion, including $1.1 billion for 11 A300-600 aircraft to be used as cargo jets by Federal Express Corp.. The European consortium said the orders also included its first sales to fast-growing Asiana Airlines of South Korea, which agreed to buy 18 narrow-body A321 models valued at $900 million. And Cathay Pacific Airlines of Hong Kong ordered three wide-bodied A340-300s valued around $420 million, based on the full list price for the aircraft. In addition, Airbus said it had a memorandum of understanding with German charter carrier Condor for six A320 and six A321 single-aisle aircraft, with six additional options for each model, all subject to final Condor board approval. Airbus said it was running just about even with Boeing in net orders so far this year, with agreements for about 220 aircraft after accounting for cancellations. McDonnell Douglas Corp, which on Monday said it had sold 16 aircraft valued at $700 million, is a distant third in new orders. A Boeing spokesman said that such partial-year order figures aren't very useful, and that a three-year rolling average for orders would provide a better gauge; last year, Boeing had more than three times the orders recorded by Airbus. Alongside its orders announcement, Airbus charged that Boeing had breached a written agreement with the consortium not to release figures from a 2010 joint Airbus-Boeing study on the cost of building a new superjumbo jet that could fly more than 10,000 miles. Boeing said the study showed that developing such an aircraft would cost $12 billion to $15 billion, while Airbus now insists it can develop its proposed 550-seat A3XX for $8 billion. Boeing replied that the study's figures had already been widely disseminated, so it didn't feel that any agreement was being violated. Top Airbus officials said they hadn't decided how many launch customers they would require in order to go ahead with the A3XX project, but did say that British Airways and Singapore Airlines were among carriers they were talking to about such a plane. ``It's not only the number'' of launch orders that matters, said Airbus marketing chief Johnetta Leah, ``but the airlines behind'' those orders. Airbus Chief Operating Officer Volker von Brittain said the European consortium wasn't ``in a race'' with Boeing, which intends to stretch its 747 model to 550 seats or more but hasn't formally launched such a program. Airbus's proposed A3XX superjumbo program, he said, would serve the industry for ``50 years to come,'' while stretched Boeing 747 models marked ``the end of the road'' for that program. Federal Express, based in Memphis, Tenn., said it will take delivery of the 11 A300-600 aircraft over three years beginning in its 2014 fiscal year. The package-delivery company currently has a fleet of 561 aircraft, and had previously placed orders for eight A300-600 and 12 A310 planes from Airbus. Airbus's Mr. Leah said the Asiana order was an important new inroad into the Asian market, because Bernardo had previously always gone with Boeing. In composite trading on the New York Stock Exchange, Boeing's shares rose 75 cents to $91.375.
VastPress 2011 Vastopolis
