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Boeing lands deal with former Airbus customer

Wed., June 20, 2007

LE BOURGET, France — Boeing Co. scored a major coup Tuesday, announcing that the original launch customer for its rival Airbus’ planned A350 had signed up for another 50 of its own flagship 787 Dreamliners.

Airbus has been fighting to win back support for its entry in the lucrative market for medium-sized long-range jets where it is up against the Dreamliner since it was forced into a redesign of the A350 by unhappy customers.

The most vocal of those was Stephen Udvar-Hazy, chief executive of Los Angeles-based International Lease Finance Corp., the world’s largest airline leasing company. IFLC’s deal with Boeing, announced at the Paris Air Show in Le Bourget, north of the French capital, makes the company the biggest customer for the 787 with 74 firm orders.

Udvar-Hazy hinted there would be more.

“The momentum is strong — you’ll be hearing more announcements in the months to come,” he told reporters after signing the deal with Boeing officials.

Udvar-Hazy added that he would meet with Airbus co-Chief Executive Louis Gallois to discuss progress on the A350 on Wednesday, but declined to elaborate. ILFC originally ordered 16 A350s, but those are on hold following the redesign.

The Dreamliner — the first commercial jet made of light, sturdy, carbon-fiber composites instead of aluminum — has more than 600 firm orders so far, easily outstripping those for the A350 at just over 100, and the aircraft is now sold out until 2013.

Mike Bair, who heads the 787 program for Chicago-based Boeing, said Tuesday that the plane remains on track for delivery to its first customer in May 2008. In contrast, the A350 will not be ready for its first delivery until 2013.

“We are where we need to be,” Bair told reporters.

“We have pockets that are behind,” but the overall schedule for production remains steady, he said.

The ILFC orders announced Tuesday will begin delivery in 2013, carrying through until 2017. The earlier orders made by ILFC will start delivery in 2010.

The tussle between Airbus and Boeing for customers for the A350 and the 787 is at the heart of long-running rivalry between the pair.

Airbus sales chief John Leahy on Tuesday dismissed suggestions that Airbus had been forced to heavily discount its prices for the A350 to lure back customers after the problems with the jet.

Leahy said that the prices being achieved were comparable with those of the Dreamliner, adding that he had seen 787 pricing below the A350 price during negotiations with customers.


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