British Air parent to buy up to 200 jets, first sales since
grounding after fatal crashes
By Robert Wall and Andrew Tangel
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (June 19, 2019).
LE BOURGET, France -- Boeing Co. won a landmark 737 MAX order
from British Airways parent IAG on Tuesday, ending a sales drought
in the wake of the grounding of the aircraft following two fatal
crashes.
International Consolidated Airlines Group SA, as IAG is formally
known, said at the Paris Air Show it had signed a letter of intent
for up to 200 Boeing 737 MAX planes. It would buy the 737 MAX 8,
the model that crashed in October and March, as well as the larger
737 MAX 10.
"Looking into the future, we recognize this is a great
aircraft," said IAG Chief Executive Willie Walsh. Mr. Walsh, a 737
pilot early in his career, recently flew a MAX simulator to assess
the flight-control change that Boeing has proposed to address
issues identified in the crashes.
Mr. Walsh said he tested the original flight-control system and
the upgrade. "It was a very helpful exercise. It gave me confidence
both in the aircraft and the changes" proposed by Boeing, he
said.
The deal is the biggest vote of confidence in the beleaguered
plane since its grounding more than three months ago.
The plane will be operated by British Airways and IAG budget
units Level and Vueling, Mr. Walsh said.
IAG's commitment to the jet comes as regulators are getting
ready to test fly Boeing's MAX flight-control-system fix. The
assessment is a critical step for them to decide when the MAX can
resume flying passengers.
Some U.S. pilots say that more still needs to be done to make
sure pilots are trained to fly the MAX safely. "We remained
concerned about whether the new training protocol, materials and
method of instruction suggested by Boeing are adequate," said Dan
Carey, president of the union that represents pilots at American
Airlines Group Inc., in testimony prepared for a hearing being held
Wednesday by the aviation subcommittee of the House Committee on
Transportation and Infrastructure.
Boeing also secured a commitment from Korean Air Lines Co. and
Air Lease Corp. to buy 787 Dreamliners.
Boeing entered this week's Paris Air Show in an unusual
situation. The U.S. plane maker had racked up 125 more
cancellations than new orders for this year, reflecting few
bookings and a raft of canceled orders, including from India's
financially struggling Jet Airways.
The plane maker failed to win any new orders in April or May.
Air New Zealand Ltd. said last month it would buy eight 787-10
Dreamliners, but the deal wasn't finalized.
The biennial Paris Air Show is typically a place for plane
producers to showcase new products and book large airliner
orders.
However, this year Boeing has had to balance that with handling
the fallout of the two 737 MAX crashes, which killed a total of 346
people.
Boeing said on Tuesday that Korean Air would deploy 20 of the
largest version of the Dreamliner, the 787-10, and 10 slightly
smaller 787-9s. The deal has a value of $6.3 billion before
industry-standard discounts. Some of the planes are being acquired
by plane-rental firm Air Lease and placed with the Asian
carrier.
Air Lease separately ordered five 787-9s at a prediscount price
of $1.5 billion.
Rival Airbus SE continued its order haul, including for its
newly launched A321XLR, introduced at the air show on Monday.
IAG, which has long signaled interest in the Airbus model to fly
trans-Atlantic routes, said on Tuesday it was ordering 14 A321XLRs,
six for Irish unit Aer Lingus and eight for Spain's Iberia.
Both carriers would open new trans-Atlantic routes, IAG
said.
Philippine budget carrier Cebu Pacific ordered 10 of the new
Airbus planes, with first delivery in 2024, along with 16 of the
wide-body A330-900s and five A320neo single-aisle jets.
Saudi Arabian Airlines added to an earlier A320neo deal, taking
as many as 100 of the planes, including 15 of the A321XLR.
Delta Air Lines Inc. also topped up its commitment for Airbus
A220 planes, ordering five more of the jets.
--Alison Sider contributed to this article.
Write to Robert Wall at robert.wall@wsj.com and Andrew Tangel at
Andrew.Tangel@wsj.com
(END) Dow Jones Newswires
June 19, 2019 02:47 ET (06:47 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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