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EDITIONS
Monday, 22 July, 2002, 07:43 GMT 08:43 UK
Boeing abandons orders game
Mothballed planes in the Mojave desert
Hundreds of mothballed planes could fly again
The ritual one-upmanship between the world's leading civil plane maker Boeing and Airbus, the rival for the title, over aircraft orders will be missing from this year's Farnborough Air Show.

Boeing claims it has pulled the plug on the annual heavyweight showdown by not holding back any order announcements, "unless requested by customers".


It was just a big game to make news

Randy Baseler
Boeing
Airbus, which plans to match Boeing's civil aircraft production figures for the first time next year, has dismissed this as a ploy to hide the US giant's falling orders.

"Everyone does it," said an Airbus spokesman.

"Ultimately it's the customer who decides and an air show can get them maximum publicity."

The move caps a bad 12 months for the plane makers, who had already been hit by a slump in the airline industry due to the global economic slowdown.

Airlines in the last financial year reported total losses of about $17bn, which is more than the combined profits they have ever made.

Small and medium size passenger jet makers, like Canada's Bombardier and Brazil's Embraer, have shown better than expected sales but US-German Dornier-Fairchild has collapsed and is looking for a buyer.

Desert planes

The 11 September attacks sent the airline industry into a nosedive and about 2,000 used but serviceable planes have been mothballed in the Mojave desert in the US.

Boeing aircraft factory
Orders can take years to be delivered
"The manufacturers could be in for an extended drought, there's so much parked in the deserts," said David Solon, Senior Aviation Consultant with Avmark International.

Boeing and Airbus will be hoping the most of the parked planes will be "turned into beer cans", as they say in the industry.

But up to 700 of the idle jets, the equivalent of one year's deliveries, are fairly new and could return to service.

Deliveries on track

Airbus plans to deliver 300 planes this year, down from 325 in 2001, and Boeing reckons it can deliver 380, down from 527 in 2001.

Airbus boasts it has won recent order battles, but Boeing says its the number of planes delivered that really counts.

Though the two manufacturers do not publish the prices at which their planes are sold, both are thought to have cut prices and offered generous financing deals to carriers to help sustain output.

False impression

Orders at air shows get extra attention, but the practice "really leaves a false impression of what's going on," said , Boeing Commercial Airplanes group marketing vice president Randy Baseler last month.

At last year's Paris Air Show, which alternates with Farnborough, Boeing announced only three new deals while Airbus announced 175.

"We got crucified with the stock (price) and the media," Mr Baseler said.

Boeing has complained that Airbus announces tentative agreements, then firm agreements when deals are signed, followed by ceremonies after buyers "reconfirm" the orders, but "we were just as guilty as Airbus," Mr Baseler said.

"It was just a big game to make news."

The two manufacturers announced orders for 369 new jets at Farnborough in 2000 for a record $52bn.

New orders

But Boeing and Airbus might still walk away clutching a few orders.

KLM is tipped to announce a 12 plane deal for the Airbus A330 worth at least 1.5bn euros (1bn).

Other orders could come from Chinese carriers, which are estimate to be need about 70 planes, and Dubai's Emirates has said it wants more expensive wide-bodied aircraft and Ethiopian and Iberia are also thought to be in the market.

But a $6bn order for 120 planes from UK's fast-growing, low-cost carrier EasyJet, which was expected at the show, now looks likely to be signed in August.


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10 Jul 02 | Business
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