Qatar Airways orders up to 100 Boeing jets

Qatar


Qatar Airways announced Friday a firm order from Boeing for 30 787-9 Dreamliners and 10 777-300ERs widebody jets and an additional letter of intent to order a further 60 single-aisle 737 MAX 8s.

According to data from aircraft valuation firm Avitas, the full 100-jet order — which is valued at $18.6 billion at list prices, assuming the MAX order is finalized — is worth an estimated $8.8 billion after standard industry discounts.

The sale throws Boeing a lifeline in a year when airplane orders, especially widebody jet sales, have slowed to a level bringing fears of a downturn ahead.

This is the largest Dreamliner order since 2013. And the smaller order for 777s will go at least some way toward bridging the yawning production gap ahead of the ramp-up of the new 777X early in the 2020s.

His analysis of the production gap prior to the Qatar order shows 39 unsold 777 delivery slots in 2018 and 49 in 2019 even at the slowed rate of 66 jets per year.

Hamilton said the Qatar order is “still very inadequate to fill the gap.” And he’s also dubious about the solidity of Qatar’s “letter of intent” to buy the MAXs.

He points out that in the language of airplane sales announcements, the ranking of solidity slips down from firm orders to options to a “memorandum of understanding” and finally to a “lettter of intent.”

“That’s smoke and mirrors,” said Hamilton, “It’s a poke in the eye for Airbus, that’s all it is.”

Qatar Airways CEO Akbar Al Baker this summer was publicly critical of Boeing rival Airbus over delays to the airline’s A320neo jet deliveries due to problems in getting enough engines from Pratt & Whitney.

At Friday’s press conference, Al Baker said the airline will not cancel its sales contract for 50 Airbus A320neos, which is the competitor jet to the Boeing MAX.

But he praised the MAX as “reliable” and said it will provide “a firm delivery schedule.”

The timing and location of Friday’s announcement was clearly determined by the politics of a major U.S. arms sale to Qatar.

The finalizing of the widebody jet order comes shortly after the U.S. government signaled approval to let Boeing sell 36 F-15E jet fighters, reportedly worth about $4 billion, to the Qatar government, a close ally of the U.S.

Al Baker denied any linkage, saying, “Nothing is attached to anything.”

owever, the political element of the commercial relationship was underlined by the presence at the press conference of Qatar’s minister of finance, Ali Shareef Al Emadi, who is also chairman of the airline; Qatar’s Ambassador to the U.S., Mohammed Jaham Al-Kuwari; and Tony Blinken, the U.S. deputy secretary of state.

Al Baker also took the opportunity to take a swipe at the campaign by American Airlines, Delta Air Lines and United Airlines to curtail access to U.S. destinations by the three large Gulf carriers, including Qatar.

The U.S. airlines allege that the Qatar government subsidizes the airline, creating unfair competition.

Al Baker said the commercial terms of deals such as the Boeing order should take precedence over “the vested interest” of competitors.

Source: www.seattletimes.com

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