December 8, 2011 / 8:10 PM / 7 years ago

Boeing eyes remaining aircraft orders in U.S. spree

(Reuters) - Boeing Co (BA.N), on track to notch its highest number of commercial aircraft orders since 2007, is working to bag what many experts say are the last available orders in a buying spree by U.S. operators.

The world’s second-largest planemaker after Europe’s Airbus EAD.PA is deep in talks with United Continental Holdings UAL.N, FedEx (FDX.N) and Southwest Airlines (LUV.N) for orders for several hundred airplanes — widebody and narrowbody —, according to industry experts and sources with knowledge of the order negotiations.

Once those customers make their deals, the long-awaited U.S. order frenzy will have run its course, some say.

“These are orders that people have been waiting for the last several years. The chapter that everybody has been waiting to turn to are the North American carrier orders,” said Alex Hamilton, managing director with EarlyBirdCapital.

Hamilton noted that most of the orders are tied to fleet replenishment, not expansion, and that the appetite for new planes in this part of the world is very limited.

“There’s certainly a question that’s raised,” he said. “We’ve peaked.”

Boeing has taken orders for 643 airplanes this year, according to its website. The gross total is the highest since 2008, when the company scored 669 orders. But 2007 was a record year for Boeing, which took 1,423 orders that year.

An industry downturn took its toll on global aircraft orders after 2007, and U.S. carriers froze much of their spending as they slashed capacity to offset flagging travel demand.

Boeing and Airbus are bidding to sell around 150 narrowbody jets to United Continental.

Boeing also is nearing deals with Southwest Airlines for about 100 narrobody 737 MAX jetliners and with FedEx for about 30 767 freighters, according to media reports.

Sources said Boeing was expected to win the order with FedEx, which had also talked with Airbus this year.

“Both of these have been going on for quite some time. Maybe it’s a good idea to finish it by the end of the year,” said Adam Pilarski, senior vice president at AVITAS, an airline consulting company that also works with aircraft lessors and lenders.

These final, percolating orders follow a giant order placed in July by now-bankrupt American Airlines AMR.N for 460 single-aisle jets worth up to $40 billion split between Boeing and Airbus. In August, Delta Air Lines (DAL.N) said it ordered 100 Boeing Next-Generation 737-900ER airplanes.

There has been a long-expected avalanche of orders from U.S. carriers, which are craving fuel-efficient airplanes to replenish their fleets as the industry recovers from the years-long downturn.

United, Southwest and FedEx all declined to comment on potential pending orders. Boeing also declined to comment on talks with customers.

Southwest Airlines Chief Executive Gary Kelly said in late October that the carrier was being briefed by Boeing on the 737 MAX and added it was “very desirous” of the next-generation engine technology.

“I certainly expect Southwest at some point to buy this plane,” said Hunter Keay, airline analyst with Wolfe Trahan & Co. “The long-term strategy for them is going to be centered around the 737.” (Reporting by Kyle Peterson, Lynn Adler, Karen Jacobs and Tim Hepher; editing by Carol Bishopric)

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below