Qantas opts for new Airbus jet

By BRYAN CORLISS

Herald Writer

Qantas today ended a 40-year run as an all-Boeing airline by announcing plans to buy 25 Airbus jets.

The $3.4 billion deal with Airbus includes 12 superjumbo A3XX jets — more than enough to guarantee that the European consortium will press ahead with its 555-seat plane.

Boeing officials also claimed victory, however. Qantas will be the first customer for the Boeing’s new Longer Range 747-400 jets,c an extended-range version of the current production models. Qantas will pay Boeing $1.2 billion for six of the jets, which until now have been called the 747-400X.

Given that, "I sure don’t see it as a setback at all," Boeing Commercial Airplanes Group President Alan Mulally said. "It’s an important development for us at Boeing because the Longer-Range 747-400s are really the first step in the 747X family."

That family includes Boeing’s proposed new 747X, which could carry 430 passengers more than 10,000 miles, and the 747X Stretch, a 520-seat plane that would be Boeing’s largest.

Airbus lists the A3XX at about $230 million each, according to Reuters. However, the Australian Financial Review reported that Qantas will get a 30 percent discount on the planes, which will be delivered starting in 2006.

Qantas’ announcement of its intent to buy the A3XX was not unexpected. Airbus officials last month announced that the Australian airline had opted to buy the proposed new superjumbo, rather than Boeing’s proposed 747X.

Qantas responded by saying that announcement was premature — a signal, analysts believed, that Boeing and Airbus still were slugging it out over whether Qantas would flesh out its order with smaller Airbus 330s or Boeing 767s.

Today’s announcement answered that question: Qantas will take 13 A330-200s and A330-300s.

The airline selected the A3XX for a variety of reasons, including its payload capacity, operation and economic advantages, and its developmental potential as the start of a new aircraft job, Airbus chief executive-designate Geoff Dixon said in a statement.

Qantas plans to retire its 747 Classics from its international fleet, as well as its 767-200s from its domestic fleet. It will continue operating Boeing 747-400s, 767-300s and 737s, the airline said.

However, Qantas is expected to take seven Boeing 767s now owned by or being built for British Airways, the Australian Financial Review reported. Qantas also may take some or all of the 747-400s that British Airways is selling.

British Airways owns 25 percent of Qantas.

Losing a longtime all-Boeing customer like Qantas "would certainly be a disappointment," said Robert Toomey, managing director for research with Dean Rauscher Wessels in Seattle.

Yet it couldn’t be considered a crushing blow, he said. "Boeing certainly has been winning its traditional two-thirds market share this year."

Indeed, the Qantas order means Boeing has sold nearly $3.2 billion worth of widebody jets since Monday, Mulally noted. "We’re very pleased with this week’s orders," he added.

Qantas started its jet service with Boeing 707s in 1959, making it the first airline outside the United States to operate the jets. The airline took delivery of its first 747-238B in 1971, and from 1979 to 1985 boasted of being the world’s only all-747 fleet.

In 1985, Qantas began operating 767-200 jets — which, like the 747s, are built in Everett — and it added next-generation 737s, 767-300ERs and 747-400s to the fleet later in the decade.

Qantas used the big 747s on nonstop routes from Sydney to London. And given the great distances the Australian airline hauls passengers across the Pacific, it would make sense for it to buy the superjumbo A3XX, Toomey said.

"Some airlines," Mulally acknowledged, "will need a bigger plane than the 747." And those airlines will likely lean toward the A3XX, he said.

However, he said, Boeing feels the "center of the market" is going to be a plane just slightly bigger than the current 747, which has a long-haul capacity of about 430 passengers.

Boeing continues to see interest in the 747X and 747X Stretch — in both passenger and freighter versions — from a number of carriers, and expects to have the first orders for the planes within the next six months, Mulally said.

Assembly of the new Longer Range 747-400s for Qantas should begin in Everett in six to nine months, Mulally said. They are due to be delivered in 2002.