Growing 787 order book inks Air India
Boeing won another big order for its new, fuel-efficient 787 yesterday when Air India said it would buy 20, with options to purchase seven...
Seattle Times business reporter
Boeing won another big order for its new, fuel-efficient 787 yesterday when Air India said it would buy 20, with options to purchase seven more later.
India's national flag carrier also ordered 15 Boeing 777s and took options on eight more.
Not counting options, the deal is worth about $6 billion at list prices, though airlines typically receive discounts of at least 30 percent.
Air India's decision, subject to its government's approval, brings total orders and commitments for the 787 to 237 planes, with more orders expected in coming weeks.
The deal, coming a day after another $6 billion order from Air Canada, including 14 787s, underscored how Boeing's new jet is fast outstripping Airbus' competing A350 in orders.
"They keep racking up the score against Airbus," said Byron Callan, an analyst at Merrill Lynch.
If Airbus loses the next big order, expected to come from Qatar Airways for about 60 planes, "it really has to suggest that Airbus rethink the A350 program," Callan said.
Boeing has active proposals with 26 airlines for an additional 429 787s, Mike Bair, who heads the new jet program, said yesterday in a conference-call update on the 787 program.
He said Boeing has seriously competed against Airbus' proposed A350 during over the past six to nine months.
"We've always assumed very rigorous competition from Airbus. We had no idea what they were going to do," Bair said.
"I'm not sure they do yet, either," he said.
Boeing is still talking to potential customers about the size of the 787's stretch version, the 787-9, which is scheduled to enter service two years after the entry of the baseline model, the 787-8, in 2008.
The stretch version's current plans call for 259 passengers in three classes, but that could grow by "a couple seat rows," meaning 10 to 20 seats, Bair said.
"Another 10 or 20 seats, but no more than that, and even that's kind of iffy. We have to talk to customers and see what they want," Bair said.
Adding seats could boost Boeing's chances with airlines like Dubai-based Emirates, which has said the 787-8 is too small.
Bair said the recent flurry of orders does not stem from the December shake-up in which commercial-jet sales chief Toby Bright was replaced by Scott Carson.
"Scott Carson is a wonderful addition to our team," Bair said. But, he added, "the vast majority of this activity has been in the works for a year or more, in some cases."
Some airlines are taking longer to make decisions about the 787 because they have never been involved in the launch of a new jet, he said.
"They're more careful in the way they approached this."
And some orders that Boeing expected to have in 2004 have spilled into 2005, making Boeing miss its publicly announced order goal of selling 200 787s by the end of last year.
"It's just taken more time for these customers to finish their evaluations and conclude their negotiations with us," Bair said.
Melissa Allison: 206-464-3312 or firstname.lastname@example.org