Skip to main content
Advertising

Originally published March 14, 2012 at 1:09 PM | Page modified March 15, 2012 at 3:31 PM

  • Share:
             
  • Comments (13)
  • Print

Boeing has China deals for 30 more 777s, Albaugh says

Boeing has won fresh orders for 30 of its star 777 widebody jets from various Chinese airlines, Commercial Airplanes Chief Executive Jim Albaugh said Wednesday.

Seattle Times aerospace reporter

Most Popular Comments
Hide / Show comments
Hi-tech manufacturing is our strtength. Congratulations Boeing. You make us proud and... MORE
I found it laughable when the Boeing Company moved its headquarters to Chicago to be... MORE
The Chinese are smart, they are buying the best passenger airplane in the world, the... MORE

advertising

Boeing has won fresh orders for 30 of its star 777 widebody jets from various Chinese airlines, Commercial Airplanes Chief Executive Jim Albaugh said Wednesday.

The sales are worth nearly $9 billion at list prices. Based on market-pricing data from aircraft-valuation firm Avitas, the estimated purchase price after standard discounts is just less than $5 billion.

Speaking at the J.P. Morgan aviation conference in New York, Albaugh said the deals were struck while he was in China last week. On that visit, he met with airlines and also signed a collaboration agreement in Beijing with Chinese airplane-maker COMAC.

Boeing spokesman Marc Birtel afterward clarified that the 30 orders are not yet finalized. The figure includes 10 777-3000ERs for China Southern Airlines, a deal announced Feb. 28.

In China, after an airline signs a deal with a jet manufacturer, the government must still approve the funds. That hasn't happened yet in this case, Birtel said, and until it does the Chinese 777 sales won't be formally listed on the Boeing order book.

The Boeing order boost from China comes as rival European jet-maker Airbus is concerned about losing sales because the Chinese government has strongly objected to the European Union's imposition of its Emissions Trading System (ETS) on all airlines flying into European airports.

The ETS, seen as a unilaterally imposed carbon-emissions tax, is opposed by other countries besides China, including the United States. But China has been the most vocal opponent.

Last week Airbus Chief Executive Tom Enders — along with the chief executives of five European airlines and two European jet-engine companies — sent a letter to the heads of government of Germany, France, the United Kingdom and Spain, expressing concern that the quarrel over the ETS will put jobs at risk in Europe.

The letter said approval for $12 billion worth of Airbus orders for Chinese airlines has been suspended until the dispute is resolved.

Separately at the J.P. Morgan conference, Albaugh commented on a report from India that a government official told reporters that Boeing has agreed to pay state-owned Air India $500 million in compensation because of delays in delivering 27 Dreamliners ordered in 2005.

"I think if we settled for $500 million, somebody would have told me," Albaugh said, "We don't comment on deals that we've done, but I can tell you that we're not writing anybody a check for $500 million."

Albaugh's denial that this amount of cash is changing hands nevertheless leaves open a more likely option — that Boeing compensates the airline for the delays in other ways, such as reducing the payments due on delivery of the 787s, or price breaks on ancillary services such as training and aircraft support.

Birtel said "mitigation can take many different forms" and that Boeing "works with its customers to address contractual requirements as they take delivery of their airplanes."

Air India is expected to take its first 787 next month.

Last year the airline, which is in financial distress, issued a formal request for loans to complete the purchase of its first seven Dreamliners, pegging the cost of each at $110 million. The U.S. Export-Import Bank offered lenders a guarantee for 85 percent of the loan.

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

News where, when and how you want it

Email Icon


Advertising