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Emirates Yet to Ink Boeing Deal Amid Performance Guarantee Talks

Emirates, the biggest international airline, has yet to sign off on its $76 billion purchase of 150 Boeing Co. (BA) 777X wide-body planes as it extends a dialog over issues such as performance guarantees, the manufacturer said.

The 777X order announced at the Dubai Air Show in November amounted to a commitment rather than a firm contract, and there remains work to be done in areas also including technical support and warranties before the deal is secured, according to Marty Bentrott, who heads up Boeing sales in the Middle East.

“I’d say we have agreement on probably the most significant part of contract, but there is a lot of additional detail to work out,” Bentrott said today in an interview at the Bahrain Air Show. “That will take us a few more weeks to sort through.”

Beyond Dubai-based Emirates, Qatar Airways Ltd. and Etihad Airways PJSC of Abu Dhabi, which have already ordered the 777X, interest from other Middle Eastern carriers is likely to be more long term, the executive said, highlighting companies including 777-300ER operators EgyptAir and Saudia Airlines as potential sales prospects.

“If you look at carriers like Saudia, I believe the 777X in future will be part of their fleet,” Bentrott said. “Do they need to make a decision now? No, they’re just in process of adding the -300ERs, so I think it’ll be several years away.”

EgyptAir also has new 777s and it may be some years before it’s ready to upgrade, though the carrier has yet to make decisions on other requirements, he said.

‘Bullish’

Boeing regards the 787 Dreamliner as better suited to smaller Mideast operators such as Gulf Air and Royal Jordanian Airlines, which have already ordered the plane, Bentrott said.

Iraq, whose flag-carrier is also taking the Dreamliner, provides further order prospects, and Boeing also sees regional opportunities for the 737 Max narrow-body, he said.

“In terms of commercial aviation the Middle East will stay robust,” the sales chief said. “The region is still growing and we’re very bullish on this part of the world.”

The Qatar Airways order for the 777X is linked to the Emirates deal for the plane, with the two carriers having held joint negotiations with Boeing before the Dubai announcements. Bentrott didn’t comment on the status of the Qatari contract.

To contact the reporter on this story: Deena Kamel Yousef in Dubai, UAE at dhussein1@bloomberg.net

To contact the editor responsible for this story: Christopher Jasper at cjasper@bloomberg.net

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