If the Machinists strike at Boeing extends through the end of September, it could force the company to postpone delivery of 42 airplanes...
If the Machinists strike at Boeing extends through the end of September, it could force the company to postpone delivery of 42 airplanes worth more than $4.1 billion at list prices, according to an analysis by The Seattle Times.
Thirty of the expected deliveries, or more than 70 percent, are the popular narrow-body 737s assembled at the company’s Renton plant.
The delivery projections were obtained from the Airclaims CASE database.
The 737s would be worth $1.7 billion at list prices, although discounts of more than 20 percent are common.
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Scheduled September deliveries of Boeing’s more expensive wide-body airplanes include four 747-400 freighters for Asian cargo carriers and six 777s, including three 777-300ERs — Boeing’s most expensive plane with a list price of $226 million to $253 million — for Emirates, the Middle Eastern carrier based in Dubai.
Customers typically pay an upfront deposit for planes, but much of the total price tag is collected when the aircraft is delivered.
Alan Mulally, chief executive of Boeing Commercial Airplanes, said at a news conference last week the company would not be able to make deliveries if the Machinists went on strike because it had not accelerated production and completed jets ahead of schedule in recent weeks.
Chaz Bickers, a Boeing spokesman, said the company had no comment on its delivery outlook during the strike.
“Obviously we can’t assemble or build the airplanes if the people aren’t here to do that for us,” Bickers said yesterday. “We’ll continue to support our customers with their in-service fleets and stay in close contact with them” about deliveries.
Bickers and Connie Kelliher, a spokeswoman for the International Association of Machinists, District 751, said there were no talks between Boeing and the union yesterday.
Southwest Airlines and Ryanair of Ireland, the largest buyers of 737s in the U.S. and Europe, respectively, received planes Thursday morning, as the Machinists were voting on Boeing’s proposed new three-year contract.
Southwest is due to receive two more 737-700s later this month, and five more by the end of 2005, bringing its total for the year to 34 deliveries.
“We are in constant contact with Boeing,” said Whitney Eichinger, a Southwest spokeswoman in Texas.
Southwest originally planned to deploy those planes on new routes serving Fort Myers, Fla., that it plans to launch early next month.
Because of the disruptions to air service in New Orleans from Hurricane Katarina, Southwest may be able to use planes that had been serving the Louisiana city on the Fort Myers routes if Boeing’s delivery schedule slips.
“There could be a scenario where we wouldn’t be impacted [by the strike at Boeing], but it’s too early to know yet,” Eichinger said.
The remaining 737 deliveries are spread across a large number of airlines. Ryanair, Hainan Airlines, Westjet and Continental Airlines are each due to receive three 737s in September. No other airline is supposed to receive more than two 737s this month.
On the wide-body side of the ledger, postponement of the four 747-400 freighters due to Asian cargo carriers would not be terribly disruptive, said Ned Laird, managing director of the Air Cargo Management Group.
The fall is peak season for Korean Air, Nippon Cargo, Singapore Airlines Cargo and China Airlines freight operations. Yet Laird said each of those carriers plans to use its new 747s to replace old, gas-guzzling 747-200s rather than to increase its freight capacity.
Airlines in the Gulf states of the Middle East will also have a lot at stake if the strike drags on. Emirates is expecting to add another three 777-300ERs to its fleet by the end of 2005. Additionally, Etihad Airways, a well-funded new airline based in Abu Dhabi, is due its first 777-300ER in October and four more by the end of the year.
The only airlines with assurances that they will receive deliveries from Boeing this fall are AirTran and Midwest Airlines, because they are awaiting 717s.
The 100-seat jets are assembled in Long Beach, Calif. by 350 workers represented by the United Auto Workers of America, Local 148.
The UAW supports the Machinists, said Local 148 President Jacki Harris, but the strike “won’t create any work stoppage here,” she said.
Seattle Times reporter Dominic Gates contributed to this report.
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WICHITA, Kan. — Spirit Aerosystems told its 8,600 employees in Kansas and Oklahoma yesterday it was shortening their workweek by no more than two days during the Machinists’ strike and subsequent work stoppage at Boeing.
Machinists walked off the job at Boeing production plants in the Puget Sound area, Portland and Wichita on Friday. The union represents 18,400 people at the three facilities.
Few watched strike developments with as much interest as Spirit Aerosystems, the company formed after its parent, Onex, bought Boeing’s commercial-aircraft operations in Wichita as well as Tulsa and McAlester, Okla.
Boeing has so far remained Spirit’s sole customer, said Spirit spokesman Fred Solis, adding that the strike underscores the need for Spirit to expand its customer base.
The Associated Press
Brazil’s Gol ups
Gol Linhas Aéreas Inteligentes, Brazil’s third-biggest airline, said it increased the number of Boeing aircraft it plans to receive next year.
The São Paulo-based airline said in a statement it will take delivery of 11 Boeing 737-800NG aircraft in 2006 instead of the six initially planned.
Gol has 60 firm orders for Boeing aircraft and options for 41 more, the statement said.
Boeing fighter jets
Singapore said yesterday it was seeking contract negotiations with Boeing to supply military jets, ending months of speculation about whether the city-state would choose American F-15 warplanes or French-made jets.
The Ministry of Defense confirmed the decision to choose American planes for the Singapore Air Force, saying in a statement it “is now in the process of seeking final clarifications and contract negotiation with Boeing.”
Shortlisted contenders to replace its A-4 Super Skyhawks were Boeing’s F-15 and Dassault Aviation’s Rafale fighter jet.
“A lot of countries watch what Singapore does,” said Richard Aboulafia, vice president of the Teal Group, a Fairfax, Va.-based aerospace analyst. “Their choosing the F-15 will likely give the plane a shot at another round of export orders.”
A contract for as many as 20 F-15s could be worth $1 billion to $1.5 billion, analysts have said.
Aboulafia said the transaction is likely for eight jets with an option for eight more, for as much as $700 million.
The Associated Press and Bloomberg News