SAA chief executive Coleman Andrews claims that Boeing's offer was clearly ahead on price, but some in South Africa remain suspicious over the involvement of the SAirGroup in the deal. The Swiss group acquired a 20% stake in SAA last year and has been cementing ties with the carrier, including a recent agreement to take over management of SAA's information technology. Under the new fleet deal, 10 of the 737-800s will now be leased from GATX Flightlease in which SAir has a 50% stake.
Critics of the deal complain that the GATX arrangement has conveniently allowed the leasing company to place aircraft that were left sitting on its books. They also claim that an Airbus purchase would have necessitated seven fewer aircraft. SAA already has seven A320s, with associated crews, flight simulator and maintenance infrastructure. It will have to start from scratch with the 737-800s and train crews in Europe.
However, Andrews says that it was simply the best deal. "It was a closely fought contest involving extremely tough negotiations, but in the end we got prices that were just unheard of in the past. Boeing was a very aggressive bidder," he says, adding that the key aim in the negotiations was to persuade the competing manufacturers to match bids so closely that there was nothing to choose between them. "But in the end they weren't that close. If they were, we would have stuck with Airbus," says Andrews.
He says the problem with the Airbus offer was that the aircraft were not immediately available and SAA would have had to deal with three or four lessors and finance providers.
Source: Airline Business
