Qantas orders three Q400s, cancels one 787

Washington DC
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Qantas has placed a firm order for three Bombardier Q400 turboprops and has cancelled an order for a Boeing 787-8 Dreamliner meant for its low-cost subsidiary Jetstar Airways.

The carrier group will also lease an additional five Boeing 717s for its domestic network.

The new aircraft will begin arriving from the second half of 2013, says the Oneworld carrier. Bombardier says the Q400 order is worth $98 million at list prices.

"This expansion to our fleet of 125-seat Boeing 717s and 74-seat Q400s gives us flexibility to pursue growth opportunities in a range of short-haul markets. It is a sensible investment in a part of the Qantas Group that is delivering strong returns," says Qantas chief executive Alan Joyce.

Qantas will operate 31 Q400s including the new aircraft, says Bombardier.

Following the 787 cancellation, the remaining 14 787-8s on order will be delivered as Jetstar as planned, with the first to arrive in mid-2013, says Qantas. Production of Jetstar's first 787 has started, it adds.

Joyce says the airline "took advantage of flexibility in its fleet plan and contract with Boeing".

"The original 787 order for Jetstar was designed to replace all 11 of its existing A330s that are used for long haul services plus provide another four lines of flying for future growth," he adds.

"While the plan is for Jetstar's long haul network to keep expanding we are using the flexibility in our agreement with Boeing to cancel a firm order knowing that we can replace it with one of our 50 options for this aircraft down the track, and with a full view of what market conditions are like at the time."

The 787s will allow for the transfer of Airbus A330s from Jetstar to Qantas' domestic operations and the retirement of Qantas' 767s.

Qantas retains options and purchase rights for 50 787s, either the -8 or -9 variants, for delivery through 2016.

The airline says the fleet changes will not impact the group's planned capital expenditure, which remains at A$1.8 billion ($1.9 billion) for fiscal year 2013, and $1.9 billion for fiscal year 2014.