Boeing feeds Asia's jet hunger
The Associated Press
SINGAPORE — Boeing won orders for 60 planes today, trumping European rival Airbus as they compete for Asian customers this week at the Singapore Airshow.
The orders, worth more than $5.4 billion at list prices and announced on the opening day of the show, gave Boeing a welcome distraction from a series of embarrassing delays in its hot-selling 787 jet program.
Airbus, meanwhile, announced no major orders in Singapore, although Korean Air Lines said Monday it will buy three more double-decker A380s on top of its existing order for five of the world's biggest commercial jets.
Most of Boeing's new orders came from Lion Air, an Indonesian budget carrier, which said it wanted 56 Boeing 737-900ER planes valued at a total of more than $4.4 billion at current list prices. Airlines typically negotiate big discounts on large orders.
The new purchase brings Lion Air's combined orders to 178 for the plane, which can seat up to 220 passengers. The airline also acquired purchase rights for an additional 50 737s.
"We make money from this aircraft," said Lion Air President Rusdi Kirana. "It is the perfect aircraft in the emerging market."
The other customer was Indonesia's national airline Garuda, which ordered four Boeing 777-300ER jets listed at more than $1 billion.
Garuda Chief Executive Emirsyah Satar said the planes will be used to open new routes, adding that he hopes they replace some of the carrier's Boeing 747s.
The airline also said it would convert its previous order for six 777-200ERs to six 777-300ERs.
Meanwhile, Boeing faces enormous pressure to speed up progress on its 787 jet, the plane maker's first all-new aircraft since the 777 in 1995.
Boeing last month said the inaugural flight for the 787 would be delayed up to three more months, pushing delivery of the first plane into early 2009.
It was the third time the airplane has been delayed.
Randy Tinseth, Boeing's vice president of marketing for commercial planes, said Tuesday the company is confident of meeting the deadlines of its new delivery schedule but would not rule out further delays.
"We are waiting until the end of the first quarter to finish the production plan and then we can make better projections on deliveries for 2009 and beyond," Tinseth told Dow Jones Newswires.
"It is a reasonable plan, but you never know."
The plane will be the world's first large commercial airplane made mostly of carbon-fiber composites, which are lighter and more durable than aluminum and don't corrode.
Boeing has said those features will make the 787 more fuel-efficient and cheaper to maintain.
They will also allow improvements such as bigger windows and a more comfortably pressurized cabin.
Despite the delays, most analysts say Boeing seems to have a better handle on its 787 production problems than rival Airbus did early on with its A380 superjumbo.
The first A380 was delivered nearly two years late last fall, a delay that slashed profits at parent company European Aeronautic Defence & Space.
On Monday, International Lease Finance Corp. (ILFC), the world's largest aircraft-leasing company, said it's in talks to buy 160 Airbus aircraft and at least 126 from Boeing.
But ILFC Chief Executive Steven Udvar-Hazy said Tuesday his company intends to act on Boeing's delay on delivery of 787s it has ordered.
When asked if ILFC will seek compensation, Udvar-Hazy said: "Definitely, on a large scale.
"We've put Boeing on notice that there will be some very serious talks," Udvar-Hazy told Reuters.
Information from Bloomberg News was used in this report.
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