British Airways Announces Orders For Airbus A380's, Boeing 787's Rating Options

[BOEING777]

http://news.independent.co.uk/business/new...icle2007529.ece

Superjumbo boost from BA to lift aircraft sales to £2,600bn

By Michael Harrison, Business Editor
Published: 23 November 2006

Airbus, the embattled European jet manufacturer, predicted yesterday that British Airways would become a major customer for its A380 superjumbo, even though the aircraft is two years behind schedule and plagued with problems.

A rather ambitious guess, given that the majority o fthe BA board does not view the A380 at all favourably, and only a few days ago Walsh stated that the airplane is more of a hindrance than a help at hubs like LHR.

[viscount234]

It does not appear that this year's sales problems, engineering problems, cancelled orders, scandals, firings, financial shenanigans and overall ass-pounding has reduced the hubris that Airbus emits. It's amazing, these guys should be filing for bankruptcy right about now yet they think they're doing an awesome job. Remind me to start shorting stocks of French and German companies, with business thought processes like these guys have, it's only a matter of time before their economic systems completely collapse.

[JayinKitsap]

My question is: has BA shown any recent interest or discussed with A the 380. If not, Airbust probably could have really ticked BA off by these kinds of remarks.

[BOEING777]

In all honesty, the wider BA board dont give a rats ass what EADS claims. While Walsh may be known as an "Airbus man", the men with the money do not share the view that the carrier has any need, let alone a pressing need to be a customer.

If it were the case, BA would already be a customer.

BA's eyes are firmly fixed on the upcoming coversion of 777 options to a firm deal, with the 787-9 and 787-10ER within its sights.

[robertkc]

In all honesty, the wider BA board dont give a rats ass what EADS claims. While Walsh may be known as an "Airbus man"

Indeed. Plus, WW has just gone on record all over the press as saying that the A380 would increase congestion at LHR due to the wake vortex findings - thereby undermining the entire rationale/business case of the entire aircraft program. If ever there was a nail in the proverbial coffin.

BA's eyes are firmly fixed on the upcoming coversion of 777 options to a firm deal, with the 787-9 and 787-10ER within its sights.

And hopefully a few 748i's as well

[BOEING777]

The BA Board is split on the 747-8I. They were happy with the shorter fuselage variant, and are still pleased with the current stretch that matches the -8F.

The only "hiccup" or grey area with regard to a purchase is the notable absence of any major customer.

If no major carrier signs up, the risk is that BA will drop it altogether from its evaluations and firm up circa 30-odd 77W's.

[robertkc]

The BA Board is split on the 747-8I. They were happy with the shorter fuselage variant, and are still pleased with the current stretch that matches the -8F.

The only "hiccup" or grey area with regard to a purchase is the notable absence of any major customer.

If no major carrier signs up, the risk is that BA will drop it altogether from its evaluations and firm up circa 30-odd 77W's.

Which lends further to my argument that LH will go with Boeing. B, knowing full well that securing an LH order for 748I's helps get the BA sale, is going to be pushing aggressively. From what I do know, B has been quite stuborn on 748 pricing.....so far at least.

[BOEING777]

Well, here's hoping that the Boeing guys do something to sell the -8I just as they have done with -8F.

[Infusion]

With regards to the 744 replacement, you can bet your buttocks that nothing apart from the -8I will win out here.

Did you bet your buttocks?

If no major carrier signs up, the risk is that BA will drop it altogether from its evaluations and firm up circa 30-odd 77W's.

What a difference five weeks makes.

At the moment, all eyes are on the 787-9 and -10.

BA's eyes are firmly fixed on the upcoming coversion of 777 options to a firm deal, with the 787-9 and 787-10ER within its sights.

I noticed a change in nomenclature from you from -10 to -10ER. Then, I take it that British doesn't believe that the -10 has a payload/range curve that is going to be good enough for them.

Why buy the A330 when the 787 has effectively made it redundant?

Because A330-200s are available for the three years between 1Q08 and 1Q11 after British moves into T5 and before the 787-9 is available. I think if Airbus convinces British to buy A380s then the addition of A330s is not out of the question. It's the kind of offset deal that could make British salivate. A British purchase of A380s is absolutely critical to Airbus and sometimes sales are a measure of desperation. I wouldn't rule out the unthinkable happening.

Airbus can bring 737/757 replacing A320s into this equation, too. More offsets...

The question is how seriously will BA look at anything from Airbus? BA's selection of the 320 drew gasps - as did United's 320 selection - in Seattle years ago. I can't see Airbus pulling this off again.

Singapore's A330/350/380 announcement at Farnborough didn't tickle your fancy?

BA won't buy the 330/340 - I'll take a bet on that.

What odds are you quoting? I might be interested.

-'Envronmental performance will be a crucial factor in assessing any new a/c'

Fuel burn and emissions aside, do you think this means QC1 departures and QC0.5 arrivals or something more relaxed?

...and only a few days ago Walsh stated that the airplane is more of a hindrance than a help at hubs like LHR.

Indeed. Plus, WW has just gone on record all over the press as saying that the A380 would increase congestion at LHR due to the wake vortex findings - thereby undermining the entire rationale/business case of the entire aircraft program. If ever there was a nail in the proverbial coffin.

A friend of mine pointed out to me that what Walsh had done was to raise the prospect of moving to mixed mode operations at LHR once his company moves to T5 and adding a third runway so that, infact, the A380 would not have a negative congestion footprint on LHR operations. To this extent, he is opening the doors to the A380 to being a more viable machine at LHR (should his wishes be granted) rather than the other way around. That said, BAA still has the blindfolds on.

Infused

[BOEING777]

Infusion:

While my bet wasnt literal, as you know, BA does want the 747-8I as a 744 replacement. Over the last few weeks, coupled with Boeings own statements on the lack of a clear true launch order for the -8I, BA is keeping its options open to re-equip with 77W's. I guess that would all change if an airline or two perhaps ordered a dozen or more -8I's between them.

The slight "switch" from the 787-10 to the -10ER is correct as is your comment. BA World Cargo would much rather the 77L be acquired, not just because of its availability- but also because BA hasnt yet decided the mix, if any, of the current options/slots it holds for the 777.

I kinda agree with your assessment of the A330 joining as part of a SQ-type deal involving A380's, but these would probably follow the same lease deal agreement as opposed to an outright purchase. A lot of this hinges on the way Ferrovial now changes BAA and its dual runway usage- if that ever materialises is another issue- if the current status quo is maintained, then the chances of a BA A380 order gets slightly slimmer

[aschonland]

I'm thinking that the real price on the 747i has come down in the last few weeks. B must be getting nervous about the lack of orders. Methinks that the first customer gets a killer deal - if Robert is right and LH do this, BA is likely to follow with CX to follow.

First mover advantage - who goes first LH or BA?

[Stratoliner777]

I really hope the LH 748-I deal goes through, followed by BA. Hopefully you guys are right and BA goes the 773ER/748-I route.

However I wouldn't put it past BA to look at the A380/A330 freebies as a prospect, at least as leverage against Boeing.

And I'm still not clear on WW's statements, he did suggest that it would increase congestion at LHR, did he not? Or is he talking out of both sides of his mouth?

[BOEING777]

I'm thinking that the real price on the 747i has come down in the last few weeks. B must be getting nervous about the lack of orders. Methinks that the first customer gets a killer deal - if Robert is right and LH do this, BA is likely to follow with CX to follow.

First mover advantage - who goes first LH or BA?

I dont think Boeing much cares, if at all, about the -8I- in part because the -8F is racking up orders and the 77W is selling very too. Thats probably part of the reason why I see Boeing moving very little on the -8I price, if at all.

[Stratoliner777]

I hope the Boeing arrogance on pricing has not returned.

If the -8F is paying for the program, perhaps they no longer need to be so tightfisted on sales--like with the 777.

[CXBoi]

The likelihood of BA getting A330s is about as remote as my chances of winning the lottery. The only way BA will get A330s is is Airbus gives them away for free. I dont think the A380 has much of a chance at BA either as I firmly believe BA is a 748i/777/787 kinda company. Plus the fact Airbus widebodies dont perform as they are intended, A332 excluded.

[Infusion]

While my bet wasnt literal, as you know, BA does want the 747-8I as a 744 replacement.

You said that the Board was split on the 747-8. May I ask, what was the split? With your above comment are you suggesting that the Board was split in majority favor of the 747-8?

The slight "switch" from the 787-10 to the -10ER is correct as is your comment.

Thank you for confirming.

I kinda agree with your assessment of the A330 joining as part of a SQ-type deal involving A380's, but these would probably follow the same lease deal agreement as opposed to an outright purchase.

Even if so, it'd still be an acquisition that would run for 7+ years.

However I wouldn't put it past BA to look at the A380/A330 freebies...

The only way BA will get A330s is is Airbus gives them away for free.

Thanks for degenerating an otherwise pretty useful thread.

And I'm still not clear on WW's statements, he did suggest that it would increase congestion at LHR, did he not? Or is he talking out of both sides of his mouth?

Walsh said the A380 would increase congestion under the status quo, but also outlined some principles of change that would mitigate the effects.

I dont think Boeing much cares, if at all, about the -8I- in part because the -8F is racking up orders and the 77W is selling very too. Thats probably part of the reason why I see Boeing moving very little on the -8I price, if at all.

If you really do think that, then I would implore you to take the blinkers off. Good heavens, man.

Infusion

[Stratoliner777]

I don't see pinpointing the truth on the A380/A330 deals as 'degenerating the thread,' rather this is a suggestion on the possible negotiating tacts that Airbus might use. IAGblog and others have suggested that Airbus is not interested in profit as much as interested in maintaining market share, keeping production and jobs, etc.

Airbus is so confident that they have pronounced BA an A380 customer even when it seems they have not yet decided. Now are they blowing smoke like when they pronounced the Japanese carriers A380 customers years ago? Or will they bite the bullet and offer BA a rock-bottom deal they cannot refuse, in order to make their prophecy self-fulfilling? And will super-cheap A330s be part of the deal? These are worthy points to consider.

I personally feel that in light of BA's longstanding preference for Boeing long-haul aircraft, and the delays + other uncertainties handicapping the A380's introduction, Airbus needs to do something pretty drastic to take the order from Boeing. And it could happen...or not.

[BOEING777]

You said that the Board was split on the 747-8. May I ask, what was the split? With your above comment are you suggesting that the Board was split in majority favor of the 747-8?

Split being that yes the Board does favour going for the -8I, but some are not prepared to go for it as the launch customer. BA stated that it no longer envisaged being a launch customer any more- whether this stance changes over time, I dont know.

I dont think Boeing much cares, if at all, about the -8I- in part because the -8F is racking up orders and the 77W is selling very too. Thats probably part of the reason why I see Boeing moving very little on the -8I price, if at all.

If you really do think that, then I would implore you to take the blinkers off. Good heavens, man.

I think you misjudged my meaning here, and I fault myself for not being clearer too- Of course Boeing wants a 747-8I launch, with as many customers as possible- however, in the interim, the -8F is selling very well indeed and I somehow dont share the view that no sales for the -8I constitutes a calamity et al. VIP variants have already been sold- by default, IMHO, the -8I will sell, its just a question of "when", not "if".

[Infusion]

I don't see pinpointing the truth on the A380/A330 deals as 'degenerating the thread,' rather this is a suggestion on the possible negotiating tacts that Airbus might use.

Pinpointing the truth?

I wouldn't put it past BA to look at the A380/A330 freebies...

Or will (Airbus) bite the bullet and offer BA a rock-bottom deal they cannot refuse ... And will super-cheap A330s be part of the deal? These are worthy points to consider.

So is the so-called pinpointed truth "the free" airplanes or "possible super-cheap" airplanes? Yes, sir, I believe that you degenerated the thread by claiming something that you later recognized wasn't a pinpointed truth.

I personally feel that in light of BA's longstanding preference for Boeing long-haul aircraft, and the delays + other uncertainties handicapping the A380's introduction, Airbus needs to do something pretty drastic to take the order from Boeing. And it could happen...or not.

This is more like it! On your point, I do sense that A320s are the the tokens in the back pocket that Airbus is holding. The A380 would be a new fleet type, but additional A320s could take out two others. In short, I think that Airbus has more leverage here than meets the eye.

Split being that yes the Board does favour going for the -8I, but some are not prepared to go for it as the launch customer.

Great. I'll bet my buttocks that if Lufthansa buys 747-8s then British will, too. Thanks for the tip.

I think you misjudged my meaning here, and I fault myself for not being clearer too- Of course Boeing wants a 747-8I launch, with as many customers as possible- however, in the interim, the -8F is selling very well indeed and I somehow dont share the view that no sales for the -8I constitutes a calamity et al. VIP variants have already been sold- by default, IMHO, the -8I will sell, its just a question of "when", not "if".

Understood. OTOH, Boeing needs a signature in order to get the -8I component of the program kick-started so that EIS doesn't slide until after 2010. If it slides, the -8I could be marginalized. So, I think that Boeing is probably anxious to get one or two signatures despite the -8F success.

Infusion

[BOEING777]

Boeing needs a signature in order to get the -8I component of the program kick-started so that EIS doesn't slide until after 2010. If it slides, the -8I could be marginalized. So, I think that Boeing is probably anxious to get one or two signatures despite the -8F success.

Indeed, and I would like to think that regardless of who the launch customer is, BA will be on board the 747-8I thereafter

[Infusion]

^

I know, I just mentioned Lufthansa to agitate you.

Fused

[BOEING777]

Hehe, LH doesnt agitate me TBH, although I do wish that *any* carrier sign up for the -8I. Id hoped that KE would have bit the bullet, but instead opted for the 77W, as we know. However, I wouldnt be surprised if KE revisits the -8I.

[Ben Jones]

However I wouldn't put it past BA to look at the A380/A330 freebies...

The only way BA will get A330s is is Airbus gives them away for free.

Thanks for degenerating an otherwise pretty useful thread.

Does anyone know if GB Airways are still due to get a pair of leased A330s in 2007, if I remember rightly they would be new builds leased from CIT for about 6 months before going off to Excel AW as 767 replacements... or have I imagined the whole thing

If it is happening, It will atleast give BA a taster of an Airbus widebody.

[Stratoliner777]

Infusion, give me a break.

My POINT is that Airbus cares less about profit and more about market share. So whether those A330s are super-cheap or freebies is the same to me--essentially they make little to no profit.

That you would accuse me of degeneracy is a very crass way to express yourself, when you could have done so otherwise. Fact is, Airbus doesn't play fair and that's that--they do so because they have different priorities than Boeing.

Keep at your personal attacks, as they make for fascinating comedy.

[CXBoi]

To the person who brought up BA and the A330 > . Why on Earth would BA want A330s when the 777 does a perfectly good job for BA in more or less the same role?

[Infusion]

My POINT is that Airbus cares less about profit and more about market share.

Evidence?

Airbus has consistently traded in double-digit operating margins and EADS director's personal earnings are directly tied to those operating margins. Infact, Airbus' grab at market share is directly linked to their belief that they could gain leverage in margins from having a higher market share. One could argue that Airbus cared too much about margins and not enough on product strategy.

That you would accuse me of degeneracy is a very crass way to express yourself, when you could have done so otherwise.

This is true. I apologize.

Why on Earth would BA want A330s when the 777 does a perfectly good job for BA in more or less the same role?

Read it again. Because A330-200s are available for the three years between 1Q08 and 1Q11 after British moves into T5 and before the 787-9 is available. I think if Airbus convinces British to buy A380s then the addition of A330s is not out of the question.

You will no doubt be aware that there is more than ten operators who are or will use both 777s and A330s. One of them, Singapore, is adding A330s to the world's largest 777 fleet. If nothing else than the Singapore experience should tell us that nothing is out of the question in this high stakes game.

Does anyone know if GB Airways are still due to get a pair of leased A330s in 2007, if I remember rightly they would be new builds leased from CIT for about 6 months before going off to Excel AW as 767 replacements... or have I imagined the whole thing.

Beats me. I thought all of CIT's A330 slots in 2007 were taken up with Hainan and Qantas.

Infusion

[BOEING777]

Just a snippet, but BA has, for the meantime focussed on the A350-1000. Not sure whether this means that the other variants have been ruled out or just put to one side- or if indeed the 77W may be ruled out either- but the 747-8I (potential) order is inching closer to reality

[Jacobin777]

Just a snippet, but BA has, for the meantime focussed on the A350-1000. Not sure whether this means that the other variants have been ruled out or just put to one side- or if indeed the 77W may be ruled out either- but the 747-8I (potential) order is inching closer to reality

Are your sources good on this? Would be interesting as the A350-1000 won't be available a good 5-6 years before BA could get the B773ER's....

Also, IIRC...BA want to replace their B767's first..for which the B787's would be perfectly suited for...

That being said, BA would be ignorant not to look at the A350-1000 seriously....

If BA go with the 787-8/787-9, I doubt they will add the A350-1000 to their fleet..but one never knows..

The B747-8I sounds nice to me...

[BOEING777]

I wouldnt say explicitly that BA is looking to replace the 767's- phase them out seems appropriate, but in time, the 787/A350 will fill that role. Given that the 787 is pretty much booked out, BA will be hard pressed to get something soon, save those SU slots- which could also be snared by the likes of AA.

787-8 is not on BA's agenda for the interim either- only the -9 and -10ER.

[Jacobin777]

I wouldnt say explicitly that BA is looking to replace the 767's- phase them out seems appropriate, but in time, the 787/A350 will fill that role. Given that the 787 is pretty much booked out, BA will be hard pressed to get something soon, save those SU slots- which could also be snared by the likes of AA.

787-8 is not on BA's agenda for the interim either- only the -9 and -10ER.

BA are looking for their replacements around 2013-2014..787 slots are available then....and if BA want some earlier slots, dont be surprised Boeing "magically" has some slot openings for BA....

Given that they are all coming off the same line, it doesn't really matter if its the-8/-9/-10ER, as the orders could be changed.........I still think the A350 has a slim chance...

Would be nice though to see get 77W's with their 777 slots...

[robertkc]

BA are looking for their replacements around 2013-2014..787 slots are available then....and if BA want some earlier slots, dont be surprised Boeing "magically" has some slot openings for BA....

BA are looking to START replacing their long-haul fleet starting in 2008 once they move into Terminal 5.

[Jacobin777]

BA are looking for their replacements around 2013-2014..787 slots are available then....and if BA want some earlier slots, dont be surprised Boeing "magically" has some slot openings for BA....

BA are looking to START replacing their long-haul fleet starting in 2008 once they move into Terminal 5.

It starts with their options on the 777's they have.....I was talking about the 767 replacements.....

[robertkc]

It starts with their options on the 777's they have.....I was talking about the 767 replacements.....

I know you were. What I'm saying is that BA are looking to replace their 767s a long way before 2013-2014. This is straight out of Willie Walsh's mouth in case you were wondering about my source...

[CXBoi]

You will no doubt be aware that there is more than ten operators who are or will use both 777s and A330s. One of them, Singapore, is adding A330s to the world's largest 777 fleet. If nothing else than the Singapore experience should tell us that nothing is out of the question in this high stakes game.
Infusion

Very true that some operators use both the A330 and 777 but most of those carriers operate in Asia where you have huge amounts of traffic flying relatively short distances ie under 2000miles. The A330 is the perfect aircraft for operating such flights whereas the 777 is a little heavy for such a mission unless, and here is the crunch, you need to carry a lot of heavy cargo in the hold at the same time you carry passengers and this is where a 777 excels. CX is a prime example of this and I am quite sure this applies to other Asian carriers as well. The SQ example isnt exactly the best example to use as realistically the A330s are being leased to them as an interim measure until the 787 arrives and are not meant to be kept in the fleet for any amount of time ie 10 years maximum.

How does all this relate to BA? Well, the A330 does not fit into the environment BA operates in as BA doesnt have short(ish) flights that require a 300+ aircraft (unless its foggy at LHR but thats another story ). The only place BA could even possibly fully utilise the A330 would be to the US and Canada but this would be a capacity cut when you compare it to the 777.

[BOEING777]

The only place BA could even possibly fully utilise the A330 would be to the US and Canada but this would be a capacity cut when you compare it to the 777.

....and thats before you factor in the significantly reduced cargo capability the former has vis a vis the 777- and upon which BA places heavy emphasis too

[Infusion]

Very true that some operators use both the A330 and 777 but most of those carriers operate in Asia where you have huge amounts of traffic flying relatively short distances ie under 2000miles.

I know what you mean. However, the context in which I introduced the A330s into the equation was for the 2008-2011 period when Boeing cannot provide British with 787-9s. (That is not to discount that additional 777s could also be an interim solution.) If an A330 acquisition eventuated for British it would, as for Singapore, be interim lift.

Nevertheless, two of the four major European airlines operating the 777 also operate A330s.

The SQ example isnt exactly the best example to use as realistically the A330s are being leased to them as an interim measure until the 787 arrives and are not meant to be kept in the fleet for any amount of time ie 10 years maximum.

FYI, the Singapore A330s will be on 60-72 month leases.

How does all this relate to BA? Well, the A330 does not fit into the environment BA operates in as BA doesnt have short(ish) flights that require a 300+ aircraft.

Cathay operates the A330-300. What British intends to replace in its first tranche are 767-300ERs. An interim replacement for these airplanes is the A330-200. British has about twenty 767 flights per day outside of Europe on transatlantic services and down into Africa and across to the Middle East.

The only place BA could even possibly fully utilise the A330 would be to the US and Canada but this would be a capacity cut when you compare it to the 777.

But not compared to the 767.

Do I think that A330s are the most likely option? No. However, I don't think that it's impossible or laughable.

Infusion

[Ben Jones]

This is apparently from an advance copy of the next issue of Flight International (2nd January I think the next ones out)

Since the deadline for manufacturers to submit their proposals has passed, BA's commercial director, Robert Boyle, has gone on record with more details about what the airline is looking for.

Here's a quick summary;

Deal will be for 40-50 aircraft to replace;
20 B747-400s
14 B767-300s
plus 10 "bridging" aircraft to cover interim growth requirements.

For the bridging aircraft which will be delivered from 2009 onwards only the A330 and B777-200ER are in contention. BA has reserved 10 B777-200ER delivery positions for 2009, but these will only be firmed up if the B777/787 is selected for the main fleet renewal order. Likewise the A330 will only be ordered if the A350XWB is selected.

In contention for the main order are the A350XWB, B777-300ER, B787-9/10 for the twinjet requirement and the A380 or B747-8 to cover the large aircraft requirement. The A340-600 has already been discounted, as the A350XWB-1000 will cover BA's requirements for this category.

The article goes on to say that the 747 replacement order is extremely unlikely to be split between the A380/747-8, but that when the next round of 747 replacements is announced there may be room in the fleet for both types.

Lufthansa ordering 747-8 has improved the prospects for a BA order, as they were unwilling to be the launch-customer, but by the same token he concedes that while the A380 delays don't concern BA it does mean the airline thinks they'll get a better deal out of Airbus.

http://www.airliners.net/discussions/gener...d.main/3172058/

[Infusion]

For the bridging aircraft which will be delivered from 2009 onwards only the A330 and B777-200ER are in contention. BA has reserved 10 B777-200ER delivery positions for 2009, but these will only be firmed up if the B777/787 is selected for the main fleet renewal order. Likewise the A330 will only be ordered if the A350XWB is selected.

Glad to note that British denotes that the reserved 777 slots are held are indeed -200ERs (for now). However, I wish that Flight had asked if the ex-British 767-300ERs with Qantas would also come back as bridge lift. The (original) leases expire in 2008 and their return could complicate the possible acquisition of A330s.

The article goes on to say that the 747 replacement order is extremely unlikely to be split between the A380/747-8, but that when the next round of 747 replacements is announced there may be room in the fleet for both types.

Yet, the winner of the first tranche will be the incumbent and probably even more difficult to knock out in the next round.

Infusion

[BOEING777]

Thanks for that update Ben- seems my BA sources are finally starting to let out more news that Ive already slightly highlighted in this thread

[Stratoliner777]

I suppose they have no need to switch 772ERs to 772LRs like DL?