Boeing sees fresh orders from Gulf

The GCC countries remain a lucrative market for Boeing, which hopes to get more than 10 new orders from the Gulf this year against the backdrop of the global slowdown.

The U.S. manufacturer also hopes to sign a firm deal with Dubai-based Emirates airline within a couple of months for the 25 Boeing 777-200/300s for which Emirates had signed a letter of intent during the Dubai air show in November, said newly appointed Toby Bright, executive vice-president of sales for Boeing Commercial Airplanes.

The deal was valued at $6.6 billion and formed part of an overall order worth $15 billion to both Airbus and Boeing. Deliveries are expected during 2004-2010. The acquisition forms part of Emirates' strategic plan to grow the airline.

"We expect to be selling in the Gulf this year. We are hopeful of our target of more than ten planes. These will be new orders," Bright told Gulf News over the phone from London. "We are also hopeful that the deal with Emirates would be finalised this quarter. I believe that is what we're targeting," he added.

Commenting on the global situation, Bright pointed out that this and the next year are going to be critical for the industry. "Air traffic growth has taken a hit...it has lost one year of growth (following the September 11 events)."

However, with Emirates $15 billion order - and yesterday's order of 100 Boeing 737-800s plus a 50-plane option, totally valued at $9.1 billion by Ryanair, indicates a return to confidence.

"Some other big ones we're working on for this year. China could be big this year," said an obviously pleased Bright.

But he cautioned that this would be a difficult year. The market has slowed down, particularly in the U.S. Growth is likely to come from other markets like China, and from low-cost carriers like Ryanair and tour operators, who have not been hurt as much as major airlines; and from replacement demand. The last may not materialise if airlines hang on to their old planes as fuel costs have gone down.

"We are counting on some activity from the Middle East," the Boeing executive said. "We have business discussions going on in this part of the world and expect to see some results this year."

On potential markets like Iran, Iraq and Libya being closed to Boeing but open to Airbus due to U.S. sanctions on these countries, Bright said: "We would like to see these markets open. But we would do what is required by our government. I can't speak of lobbying directly for these countries. Generally, the company does support free trade among countries of the world.

Boeing had 62 per cent of all plane deliveries last year and hopes to maintain the share with 380 planes expected to reach clients this year. It expects lower orders in 2002 than last year's net of 272. Airbus had net orders of 274 last year.

New orders - which have to be fulfiled in future - have not affected the present Boeing plan to retrench 30,000 workers of which 12,000 have already been laid off and the rest will be this year.

Bright said the industry's return to normalcy depends on when the U.S. economy turns around, on people's security concerns fading and on replacement orders.

The impact of September 11 showed lots of differences among regions and how they responded. "Impact in Europe lagged, it took them a while to get low travel period, while in the U.S., the impact was immediate. In China it was very little, and in the rest of Asia it was mainly on flying to and from the U.S.," Bright said.