Qantas bills Boeing for jet delay
A Sydney Morning Herald report says that Qantas and Air New Zealand are among the first airlines to publicly demand compensation – expected to run into tens of millions of dollars – from Boeing for further delays to the delivery of the more fuel-efficient Dreamliner jet.
The latest delay also casts more doubt on the international expansion plans of Qantas’s low-cost subsidiary, Jetstar, whose hopes of servicing northern Asia, North America and Europe are based on using the 787 Dreamliner.
Boeing has blamed the delay until the third quarter of 2009 on parts shortages and greater manufacturing roles for vendors. The 787 has now been postponed three times since October and is due at least 14 months behind the original scheduled delivery date – next month.
Qantas’s chief executive, Geoff Dixon, said he was not surprised by the setback but was “very disappointed that Boeing has again delayed the delivery schedule”.
Qantas does not expect to receive the first 787-800 until the second quarter of 2008. It could have to wait as long as 23 months for the longer-range 787-900s.
Qantas said it was entitled to “substantial” compensation for the delay under its purchase deal. The money would be used to offset the cost of lease agreements.
The delivery problems have forced Qantas to lease up to six Airbus A330 aircraft for Jetstar International. Qantas and Jetstar are the biggest airline customers of the Boeing aircraft, with firm orders for 15 787-800s and 50 787-900s. The first 15 787-800s have been allocated to Jetstar, which will use the jets on services to Japan and possibly South Korea and China, before deploying it to European destinations.
Qantas would not reveal the amount of compensation it sought, but its attempt to gain damages from Airbus for delays to the delivery of the A380 super-jumbo resulted in it pocketing more than $104 million last financial year. Analysts put the likely Dreamliner compensation in the tens of millions of dollars.
Air New Zealand ordered eight 787-900s, the first of which was initially expected to arrive towards the end of 2010, but is now more likely in 2012.
A Shaw Stockbroking analyst, Brent Mitchell, said Jetstar might have to delay the start of new international services it was looking to operate using the Dreamliner. “It will have more of an impact on Jetstar than Qantas, which will be offset by compensation from Boeing,” he said.
Jetstar had been keen to deploy the fuel-efficient jets to undercut competitors and service routes presently deemed uneconomical with its existing fleet of six A330s.
Boeing will now deliver only 25 of the 787s next year, less than a quarter of what it had originally planned. Japan’s All Nippon Airways is the first customer of the aircraft.
Shares in Qantas fell almost 4 per cent, or 14c, to $3.69 yesterday in its fourth consecutive day of losses, while Air NZ dropped 3c to $1.14.
A Report by The Mole from The Sydney Morning Herlad
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