Qatar Airways Mitigates A320neo Delays with Big Boeing Order

By Juliet Van Wagenen | October 10, 2016
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[Avionics Magazine 10-10-2016] Qatar Airways has ordered up to $18.6 billion aircraft from Boeing, which it says will help to expand its fleet and fill some gaps left by delays from previously ordered Airbus A320neos. At a joint press conference in Washington, D.C. on Oct. 7, Qatar Airways and Boeing signed a firm order for 30 787-9 Dreamliners and 10 777-300ERs, valued at $11.7 billion, as well as a Letter of Intent (LOI) for up to 60 737 MAX 8s valued at $6.9 billion. The 737 MAX 8s, which are scheduled to begin delivery in 2017, would be the carrier’s first purchase of Boeing narrowbody aircraft in more than 15 year.

President and CEO Ray Conner sign the $18.6 Billion agreement
President and CEO Ray Conner sign the $18.6 Billion agreement. Photo: Avionics Magazine/Juliet Van Wagenen

While this past June Qatar Airways cancelled the order for its first Pratt & Whitney PW1100G-powered A320neo plane, which it was scheduled to receive in 2015, Qatar Airways Group CEO Akbar Al-Baker said the company remains committed to its previous order for 50 A320neos and A321neos.

“We never renege on contracts that we sign. We have a contract signed with Airbus for 50 neo airplanes and we will continue to get those airplanes,” Baker said. “The aircraft we are ordering today is to serve the ever-expanding network and we are taking these [737] Max airplanes in order to get a firm delivery schedule.”

He pointed to delivery issues caused by concerns regarding the Pratt & Whitney PW1100G engines onboard the A320neo, which Baker has previously said is impacting the airline’s bottom line.

“As you know the [A320]neos are having problems. The airlines that have received them are not getting the quantities they require because of ongoing issues with the aircraft, so for us to mitigate our risk we had no alternative but to order the reliable 737 family aircraft, which will fuel our continued demand for growth,” he said.

While the narrrowbody 737s will help to expand the airline’s short-haul routes, the widebody 777s will work to bolster the airline’s network of long-haul routes and hail what Baker claimed to be the “longest commercial flight” in operation between Qatar’s capital city, Doha, and Auckland, New Zealand.

“We will be using the 777 for this flight. As you know, there is no other aircraft with that range that will make the route service possible. We rely on Boeing for our long-haul fleet,” Baker said.

The 777 order could also help improve the struggling production rate for this aircraft. In January, Boeing announced plans to cut 777 production from 8.3 per month to seven per month at the beginning of 2017 in order to manage flagging sales. The company is struggling to fill the gap between 777 production and the 777X, which is scheduled to begin production in 2018.

“This is a huge boost for the 777 program, as it is for the 787 program. We will have to see how the rest of our order stream plays out but I can tell you that 10 777s is a big deal and where these airplanes fall within our delivery stream is extremely important to us as to how we maintain or move our production rate,” said Boeing Commercial Airlines President and CEO Ray Conner during the Friday press conference.

The 777 production also got a boost from a September order for 15 777-300ERs from Saudi Arabia Airlines.

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