Boeing has taken the bulk of China Airlines' (CAL) $5.6 billion buying spree, but lost out to rival Airbus on the much prized deal to supply new medium capacity widebodies.
CAL has placed firm orders for up to 19 Boeing 747-400s and five 737-800s worth $3.8 billion, while Airbus' slice of the deal, for up to 12 A330/A340s, is worth $1.8 billion. The 747 order includes 17 -400 freighters (13 firm and four options) and two options for passenger models. The five 737-800 orders were from existing options, taking its firm orders to 20 aircraft of which 10 have been delivered.
The A340 was selected over the Boeing 777 after a long evaluation, with CAL placing firm orders for seven A340-300s and options for one more, plus four A330-300 options. The deal, agreed in June and reported exclusively by Flight International last month (21-28 July), will give the airline replacements for its 16 Airbus A300s and possibly five Boeing MD-11s.
The A340 order is a sharp defeat for Boeing, which had mounted a furious last-ditch effort to sell the 777. On 16 July, Boeing commercial president Alan Mulally flew to Taiwan and made CAL a new offer on the aircraft, while Washington State Senator Slade Gorton tried to engineer a CAL rethink during a visit to Taiwan in early August.
CAL has switched from long-time engine supplier Pratt &Whitney to General Electric for its 747-400Fs, with the CF6-80C2 being specified for the 747s and the A330 options. "GE simply gave us a better deal," says CAL president Sandy Liu. Pricing was a factor in the choice of the A340, says CAL, but "it did not play a decisive role".
CAL chairman Chiang Hung-i says extended-range twin-engine operations (ETOPS) restrictions, and fleet commonality were the deciding factors. "If we used the 777 on our trans-oceanic routes, it would be subject to ETOPS restrictions," he says. "It would take us more than a year to gain approval for the 777 to fly trans-oceanic routes. The [four engined] A340 is not limited by ETOPS restrictions."
CAL denies suggestions that Airbus had exploited the recent chilling of the political relationship between the USA and Taiwan. "This decision was made in June, after a long evaluation," says CAL. "It was not affected by politics."
Source: Flight International
