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Originally published June 15, 2005 at 12:00 AM | Page modified June 15, 2005 at 12:24 AM

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Aircraft lessor praises the 787

The second day of the Paris Air Show was a very good one for Boeing. It won substantial 777 and 737 orders. More important, perhaps, its...

Seattle Times aerospace reporter

PARIS — The second day of the Paris Air Show was a very good one for Boeing.

It won substantial 777 and 737 orders. More important, perhaps, its airplanes obtained the fulsome praise of Steven Udvar-Hazy, one of the most highly regarded market-movers in the aviation industry.

"Boeing has the right products, and going out and listening to their customers is beginning to pay off," said Udvar-Hazy, chairman and chief executive of International Lease Finance Corp. (ILFC), the large aircraft lessor.

Though he unveiled a $2.9 billion order for 777s and 737s, his most significant comments concerned the new Boeing 787 and its rival, the proposed Airbus A350.

ILFC is working toward placing a 787 order this year, he said. It is widely expected to order about 20 of the jets.

In contrast, the lessor doesn't plan to buy the A350 until 2010 at the earliest, he said.

"I think you'll see that ILFC will order what our customers want," he said. "Right now our focus is on the 787."

Udvar-Hazy said that he's in "continuing and intensive discussions and negotiations with Boeing" about a 787 deal and that final details were being worked out with the engine makers. Also, he said, "We'd like to like the price."

Boeing was able to start from a clean sheet in designing the 787, Udvar-Hazy said, because of the time it took, beginning in the late 1990s, casting around on various research projects to find the right airplane to launch.

"Looking back, it was money well spent," he said. "It means they can optimize the airplane."

That's a big endorsement for Boeing's new jet.

ILFC leases airplanes to airlines big and small around the globe. Since 1977, ILFC has ordered 678 jets from Boeing and 586 from Airbus. Nobody is better placed to gauge market interest than Udvar-Hazy.

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At the main Airbus news conference of the show, Chief Executive Noël Forgeard said there was a "huge interest" in the A350 from airlines.

But Udvar-Hazy intends to wait and see on the Airbus jet. He said that the A350's design configuration is still fluid and he's not ready to buy it now.

Udvar-Hazy held a news conference aboard Boeing's ultralong-range 777-200LR, which is undergoing flight-certification tests and is on a promotional world tour.

The airplane, the second one of that model out of the Everett factory, is fitted with a luxurious interior. It was flown to Paris by Capt. Suzanna Darcy-Hennemann, lead pilot on the 777-200LR test flights.

ILFC yesterday announced orders for two of those jets as well as six 777-300ERs and 20 single-aisle 737s. The deal is valued at $2.9 billion at list prices.

In other good news for Boeing at the Paris show:

• The other big aircraft lessor GECAS, a unit of GE, ordered 20 737s, valued at $1.1 billion at list prices. Both ILFC and GECAS said that all the planes ordered have already been placed with airlines.

• And in a third big Boeing deal of the day, Jet Airways, a premium service operator in India, ordered 10 777s and 10 737s. This order, worth about $3 billion at list prices, included six of the ultralong-range model, which Jet intends to use to inaugurate direct service between the U.S. and India.

The chairman of Jet, Naresh Goyal, also announced a smaller deal with Airbus yesterday. Jet will buy 10 A330-200/300 airplanes, worth about $1.6 billion at list prices.

Boeing Commercial Airplanes CEO Alan Mulally also had some positive news. He announced that because of new orders for the 767 and the 747, a decision will not have to be made this year on shutting down either program, as had been expected earlier.

On the 767, he said, "I think it's going to go on for a number of years."

He also said the 747 has sufficient pending orders for both passenger and freighter versions to provide a bridge to the proposed 747 Advanced.

Mulally said the Boeing board will meet this month and discuss the 747 Advanced, a new derivative that would utilize 787 engines. "I anticipate a decision on launch in the latter part of this year," he said.

Mulally also endorsed a new description of the company's global manufacturing strategy that was offered by a journalist at the main Boeing news conference.

"Do you see Boeing becoming a think tank, with hardware developed elsewhere?" he was asked.

"Yes," said Mulally. "I like that phrase — think tank."

Dominic Gates: 206-464-2963 or dgates@seattletimes.com

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