Qantas is about to cut deeply into its $20 billion commitment to new jets.
On 15 March, aware that a serious reconsideration of the order for Boeing 787 Dreamliners was underway, a series of questions was asked of Qantas.
Qantas, not surprisingly, didn’t answer them and on 18 March this item on Plane Talking was posted.
Today, in various reports, analysts at Citibank and Merrill Lynch are preparing the way for announcements that will rock Airbus and Boeing, but particularly the latter because of the large Qantas exposure to the 787 program, which is running late, no longer has any credible performance specifications, has no credible delivery timetable, and has been described to me as offering nothing more than unproven ‘game changing’ technology in a larger, overweight replacement for the Boeing 767-300 but with less range.
There is some disappointment about the 787 program among carriers who fell for the hype.
It is normal Qantas procedure to foreshadow major developments through the informed musings of analysts and journalists. Never full disclosure of course, but just enough to indicate that the company is aware of or concerned by situations or events that it subsequently deals with by an announced course of action.
The global financial crisis and the steep decline in demand for air travel world wide is driving the Qantas review of future orders, but the shortfall in lucidity and reliable progress reports from Boeing has done it immense harm.
Qantas has 65 Dreamliners on firm order plus options or purchase rights for a further 50.
Deferrals of deliveries of the biggest ticket Airbus, the A380, would, if made, also help Qantas reduce the size and rearrange the timing of future capital raisings. The airline has more Boeing 737s on order, and they are needed to replace its aged versions of the same jet, as well as A320 single aisle and A330 big twin engined airliners on order, with more of those Airbuses currently intended for Jetstar rather than Qantas.
The airline needs to replace some older less efficient jets as of about last year, when the 787s were repeatedly promised for delivery, and it needed its A380s two years sooner than they started arriving to phase out older 747s.
The airline was badly let down by both Airbus and Boeing.
It has collected some $500 million in liquidated damages from them in total in its last two financial years.
Now it looks like collecting some skin from them as well.
One Comment
As the program keeps crawling along you’ll find that at no time has a first power on engine run date been set. This IS the main first requirement of a new aircraft type-certification program. Meanwhile, global partner “Alenia Aeronautica” continues with its inept production. No realistic ramp-up to meet production needs are being made. Meaning, no credible mid-sections from the inadequate Charleston facility ( last sections received at Seattle possesed several thousand “noted” defects), and the unskilled workforce and unqualified / certificated quality personnel that are the supplier’s workforce.
By the time this program becomes viable, the extended Airbus version will be available for service. Unfortunately, Boeing will not act upon it’s suppliers, and mgmnt as Quantas has, so don’t look for ANY credible replies.