Emirates Joins British Airways Prodding Boeing on New 777

International Consolidated Airlines Group Ceo Willie Walsh
Willie Walsh, chief executive officer of International Consolidated Airlines Group SA (IAG). Photographer: Simon Dawson/Bloomberg

Emirates Airline and British Airways Plc, two of the biggest buyers for Boeing Co.’s 777, are urging the planemaker to decide soon on a successor to the top-selling wide-body model so it’s ready for service before 2020.

“We want it done now so they have the plane in 2019,” Emirates President Tim Clark said in an interview at an industry conference in Barcelona. British Airways Chief Executive Officer Willie Walsh gave the same timeline yesterday as well.

Boeing will brief its board by year-end or early 2013 on potential plans to offer an upgrade to the current version, the company’s commercial airplanes chief, Jim Albaugh, said last month. He said the Chicago-based planemaker expected the new plane to be in service “towards the end of the decade.”

Emirates, the largest customer for the 777, and British Airways, the fifth-biggest, are pushing for a follow-on model to the 777-300 by decade’s end so they can move quickly to replace some of their older planes. Airbus SAS is promoting the roomiest version of its A350 as a challenger to the twin-engine 777.

The 777, Boeing’s most-profitable commercial jet, lists for $298.3 million for the 777-300 model, which like other airliners is typically sold at a discount. A Boeing spokesman, Marc Birtel, said yesterday that there had been nothing to contradict the time frame given by Albaugh.

“I think 2019 at the latest would be my view,” Walsh said in an interview in Barcelona. “Everyone would like to have visibility around the plane and see it enter service as soon as possible.”

Fleet Replacement

British Airways, a unit of International Consolidated Airlines Group SA, intends to replace 52 Boeing 747 jumbo jets. It is currently evaluating the purchase of a 777 successor, the 787-10 Dreamliner, or possibly A350-1000s, the biggest variant of the Airbus plane.

While some of the four-engine 747s can still operate until as late as 2018 or 2019, rising fuel prices heighten the need for a more fuel-efficient replacement, said Walsh, who is CEO of London-based British Airways and IAG. Air France is the second-biggest 777 operator.

Emirates’s Clark said he has been talking to Boeing for more than two years about a new 777, and that in recent months he has urged Boeing to canvass other potential buyers to encourage a quicker decision. Dubai-based Emirates began taking its first 777s in 1995 and has ordered 174.

“Boeing had a hugely enthusiastic response when they spoke to all operators of the 777, so in terms of the business case that has to go before the board, I believe they’ve got what they need,” Clark said. He remained concerned that Boeing’s struggles with the 787 Dreamliner, which was more than three years late entering service, would stall a 777 decision.

“They screwed up badly on the non-recurring costs on the 787,” Clark said.

Boeing’s Birtel said the 777’s “strong market position” gives the planemaker time to make the right decisions on an upgrade.

“Those decisions are aligned with the right technologies and the right timing for our customers, and we are working details and studies now,” Birtel said yesterday in an e-mail.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE