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Potential 7E7 jet order from Qatar may hit 60

By David Bowermaster
Seattle Times aerospace reporter

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At Boeing's proposed 7E7 list price of $120 million, the deal would be worth more than $7 billion before discounts, which tend to be generous on bulk purchases.

The transaction would likely include 30 firm orders and 30 options, the source said, and would boost Boeing's chances of hitting its goal of 200 7E7 orders by year's end. To date, Boeing has 52 firm 7E7 orders and preliminary agreements for 50 more.

But to close the deal with Qatar, Boeing may need to accelerate its timetable for introducing a stretch version of the 7E7.

Dubbed the 7E7-9, the larger model would carry 257 passengers in a three-class seating configuration, versus 217 passengers in the baseline 7E7-8.

Mike Bair, senior vice president for the 7E7 program, said in July that Boeing had pushed back the introduction of the 7E7-9 to 2012, from 2010.

The decision did not sit well with Qatar and other Mideast airlines such as Emirates, which had said publicly the 7E7-8 was too small for their needs.

"We're ready to sign a [memorandum of understanding] from the moment Boeing crystallizes the definitions of the -9," Qatar Airways Chief Executive Akbar Al-Baker told ATWOnline yesterday in London. "We will not go for the 7E7 if they [Boeing] don't specify the -9. We want to operate a family of aircraft, not just one aircraft type."

Al-Baker said Qatar's order would include only eight or 10 of the 7E7-8s.

His sentiments echoed those of Maurice Flanagan, chairman of highly regarded Emirates airline, last summer.

"What we want is not yet available," Flanagan told The Seattle Times in June. "[Boeing's] focus right now is on the smaller airplane. By and large, airlines that are interested in long-haul traffic for major destinations are looking for something bigger."
 
Boeing at the time did not appear flexible.

"When or if Boeing decides to build the stretch airplane, we could sell that plane in that part of the world. But right now our focus is strictly on the -8," Doug Groseclose, Boeing's former vice president of sales for the Middle East and Africa, said in June.

Groseclose has since left Boeing and been replaced by Lee Monson, who previously sold Boeing business jets in the Middle East and elsewhere.

The baseline 7E7-8 is to debut in 2008. Now Boeing apparently is again considering an earlier launch date for the 7E7-9 at customers' request.

Lori Gunter, a Boeing spokeswoman, said the 2012 target has never been set in stone. "The market will decide when that product comes on line."

Gunter had no comment on the status of discussions between Qatar and Boeing.

Qatar's initial 7E7 talks with Boeing were for 20 firm orders and 20 options. The airline decided to increase the quantity after a business-plan review indicated the fast-growing airline had underestimated how many of the planes it would need by 2012, the source said.

Relaunched by Al-Baker in 1997, Qatar is an all-Airbus carrier, with a 35-plane fleet that will grow to 52 jets by 2009.

Qatar has asked Airbus to delay deliveries of the two 555-seat A380 it has on order until the second quarter of 2009, Al-Baker added yesterday, due to construction delays at the new Doha International Airport.

David Bowermaster: 206-464-2724 or dbowermaster@seattletimes.com