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Boeing Wants To Buy AI 747s For 777s  
User currently offlineUnited777 From United States of America, joined May 1999, 1657 posts, RR: 0
Posted (11 years 10 months 2 weeks 3 days 16 hours ago) and read 5916 times:

Boeing is offering to buy Air India's Boeing 747-200 and 747-300 combi's if it orders the 777-200ER.

They did the same for SIA wit the A340-300's for 777-200ER's and it worked. Lets see if Air India will do the same.

http://biz.yahoo.com/rc/030207/airlines_india_boeing_1.html

27 replies: All unread, showing first 25:
 
User currently offlineKaitak From Ireland, joined Aug 1999, 12593 posts, RR: 34
Reply 1, posted (11 years 10 months 2 weeks 3 days 16 hours ago) and read 5863 times:

Yes, the 340 purchase from SQ worked insofar as SQ bought 777s (and quite a lot of them!), but they still have 340s to place.

With AI, the problem is in one sense easier; the old -200s, I'd imagine, would either be converted to freighters or, more likely, scrapped. The -300s could, however, have a life as freighters; well, they're half way there already!

But what I'm also wondering is, why? For political reasons, following the IC order for 32Xs, Boeing was likely to get the 777 order anyway, so why involve the 747s at all?


User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 2, posted (11 years 10 months 2 weeks 3 days 16 hours ago) and read 5854 times:

Boeing is extremely concerned that Airbus is offering kickbacks to India to send BOTH the AI and IC orders to them. Based on information that I have, there is IMMENSE pressure from the Ministry on AI's board and technical committee to pick the A340 over the B777 - and is the main reason why the process is stalling right now. Essentially Airbus is offering HAL in Bangalore a bunch of component production contracts for the A380, but ONLY if the AI and IC orders go to Toulouse.

User currently offlineN79969 From , joined Dec 1969, posts, RR:
Reply 3, posted (11 years 10 months 2 weeks 3 days 16 hours ago) and read 5838 times:

-437B,

When you say "kickbacks" do you mean offsets or actual cash to key officials?


User currently offlineUnited777 From United States of America, joined May 1999, 1657 posts, RR: 0
Reply 4, posted (11 years 10 months 2 weeks 3 days 16 hours ago) and read 5830 times:

Here is another article about the AI and IA order from the Seattle Times.

http://seattletimes.nwsource.com/html/businesstechnology/134630017_boeingindia07.html


User currently offlineUnited777 From United States of America, joined May 1999, 1657 posts, RR: 0
Reply 5, posted (11 years 10 months 2 weeks 3 days 16 hours ago) and read 5799 times:

Well one thing is for sure who ever wins the order either Airbus or Boeing they will be bragging about it for years. After these two orders I don't see another big airplane ordering coming from India for another 10 years. Except for the private airlines such as Jet Airways. I could see them ordering more 737-900's.

User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 6, posted (11 years 10 months 2 weeks 3 days 15 hours ago) and read 5771 times:

When you say "kickbacks" do you mean offsets or actual cash to key officials?

Undoubtedly a mixture of both.


User currently offlineN79969 From , joined Dec 1969, posts, RR:
Reply 7, posted (11 years 10 months 2 weeks 3 days 15 hours ago) and read 5753 times:

That sucks....Boeing's hands are tied in that arena. Perhaps they could send 7E7 work to India...bribes are out of the question for Boeing. I get a sinking feeling that the A340 will win another one.

User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 8, posted (11 years 10 months 2 weeks 3 days 15 hours ago) and read 5736 times:

Boeing's hands are tied in that arena.

Don't kid yourself. Boeing is just as capable of providing "incentives" to decision makers as Airbus is, even if these come in the form of "consulting fees" and other smokescreens. It's happened before and will undoubtedly happen again.


User currently offlineN79969 From , joined Dec 1969, posts, RR:
Reply 9, posted (11 years 10 months 2 weeks 3 days 15 hours ago) and read 5726 times:

I agree with you to the exten that Boeing will do everything short of outright bribery. The Foreign Corrupt Practices Act is pretty strict and can result in prison time. I am sure there is no shortage of whistle-blowers who would love to see a Boeing exec head to prison.

User currently offlineYago From Iceland, joined May 2002, 232 posts, RR: 0
Reply 10, posted (11 years 10 months 2 weeks 3 days 13 hours ago) and read 5628 times:

Bribery is also forbidden in Europe.
Please stop believing you live in Disneyland.

Airbus and Boeing being such big companies will use bribery without any problem.


User currently offline747-451 From United States of America, joined Oct 2000, 2417 posts, RR: 6
Reply 11, posted (11 years 10 months 2 weeks 3 days 11 hours ago) and read 5565 times:

"Bribery is also forbidden in Europe"

and so are susdies  Yeah sure


User currently offline747-451 From United States of America, joined Oct 2000, 2417 posts, RR: 6
Reply 12, posted (11 years 10 months 2 weeks 3 days 11 hours ago) and read 5567 times:

subsidies .........................

User currently offlineRacko From Germany, joined Nov 2001, 4857 posts, RR: 20
Reply 13, posted (11 years 10 months 2 weeks 3 days 10 hours ago) and read 5515 times:

Nope, they aren't. But there are strict laws and every subsidy decision is controlled by the EU.

User currently offlineUnited777 From United States of America, joined May 1999, 1657 posts, RR: 0
Reply 14, posted (11 years 10 months 2 weeks 3 days 6 hours ago) and read 5436 times:

If Airbus or Boeing wanted the AI order and are fighting for it how come they didn't fly a house color A340-300 or 777-200 to the Aero India show in Bangalore for a demo like they do at other airshows.

It would have been nice to see one of them do that for India. Boeing could have also showed of the 737-900 for Indian Airlines.

I know Aero India is mainly a defense air show but it turns out this year it is turning out to be a fight between Airbus and Boeing for Air India and Indian Airlines.


User currently offlineCloudy From , joined Dec 1969, posts, RR:
Reply 15, posted (11 years 10 months 2 weeks 3 days 6 hours ago) and read 5422 times:

Bribery of may be forbiden in Europe, but is Bribery of foreign officials illegal? Even if it is done outside of Europe? Is this true in every European country?
All you need is one country where the law can be interpreted your way.

The Foreign corrupt practices act is NOT something US companies ignore lightly, because the penalties are so high. Not just in terms of jail time, but fines and PR. After Enron, people want to look clean.
But there could be ways arround it. A foreign subsidiary, perhaps? Or an unspoken "don't ask don't tell" policy that lets the local peons take the fall? Ya never know.

But we don't know. None of us that I have heard from so far are experts in this area. I have heard that it is much harder for US companies to get away with bribery - and that this is a major disadvantage for the US in negotiations with less-industrialized customers. But its hard to know. When you do stuff like this, you don't advertise it.





User currently offlineGigneil From United States of America, joined Nov 2002, 16347 posts, RR: 85
Reply 16, posted (11 years 10 months 2 weeks 3 days 6 hours ago) and read 5387 times:

Sending component production to a country to win orders is hardly new to either Boeing or Airbus.

Why do you think Japan loves the 777? The entire 777 wing is assembled there.

Its also hardly illegal.

N


User currently offlineB747-437B From , joined Dec 1969, posts, RR:
Reply 17, posted (11 years 10 months 2 weeks 3 days 4 hours ago) and read 5372 times:

According to a report today, France is now offering advanced co-operation in the area of nuclear technology if India commits to the Airbuses over Boeing.

http://in.news.yahoo.com/030207/58/20wbx.html

This bidding war is getting amusing. Big grin


User currently offlineAmmunition From United Kingdom, joined Feb 2002, 1065 posts, RR: 4
Reply 18, posted (11 years 10 months 2 weeks 2 days 23 hours ago) and read 5284 times:

Both the A340 and 777 series of aircraft are excellent, and i personally wouldnt mind seeing any in the AI livery.
I cant help but think that air india will try and sqeeze every last thing from the manufacturers to gain the best deal, obviously india has a phenomenal potential and any manufacturer to gain a foothold in the market will be laughing all the way to the bank, the rewards may not be immediate.

Could airbus offer something similar? buy the 744 aircraft off AI for A340's? Would this be the first time airbus would do this?

What are the chances of a completely new air india fleet within 5 years?




Saint Augustine- 'The world is a book and those who do not travel, read only 1 page'
User currently offlineIndianguy From , joined Dec 1969, posts, RR:
Reply 19, posted (11 years 10 months 2 weeks 2 days 6 hours ago) and read 5124 times:

According to the ToI, an Indian Software Company, INFOSYS has been signed on to do Wing Design work for the Airbus A380 in a multi-billion dollar deal!

Looks like the French are really laying it on thick!


-Roy


User currently offlineCloudy From , joined Dec 1969, posts, RR:
Reply 20, posted (11 years 10 months 2 weeks 2 days 6 hours ago) and read 5100 times:

Are you sure you don't mean multi-million dollar, Indianguy? That would seem more realistic. I doubt all the software contracts for the A380 program would add up to a billion dollars.

User currently offlineHamlet69 From United States of America, joined Mar 2000, 2750 posts, RR: 58
Reply 21, posted (11 years 10 months 2 weeks 2 days 6 hours ago) and read 5101 times:

Gigneil,

"Why do you think Japan loves the 777? The entire 777 wing is assembled there."

Where did you get that one from? The wing is perhaps the only thing that Boeing won't outsource - it's much too valuable. Compared to the wing, an aircraft's fuselage is just a metal tube. The 777's wing sub-assemblies are built throughout the U.S., and assembled in Everett (building 40-34, to be precise). They are then "flown" to the Final Body Join position in the adjacent assembly line, where the various other fuselage sections (all except Section 41 is manufactured in Japan) are mated to the wing and each other. Approxiamately 20% of the overall airframe is built in Japan.


Ammunition

"Could airbus offer something similar? buy the 744 aircraft off AI for A340's? Would this be the first time airbus would do this?"

I doubt AI is looking at selling the 747-400s, but like Boeing, I'm sure Airbus would be willing to purchase the -200s & -300s. And no, this would not be the first time Airbus has purchased used aircraft. The latest deal I can remember is the easyJet deal - Airbus is purchasing 10 737-300s from easyJet at garaunteed prices.

"What are the chances of a completely new air india fleet within 5 years?"

I've got a better one - What are the chances of any new Air India fleet in the next 5 years? With the bureaucracy of this country, I'd be very surprised if any purchase had been delivered in 5 years. (Okay, maybe I'm exagerating a little bit. . .)

Regards,

Hamlet69



Honor the warriors, not the war.
User currently offlineCloudy From , joined Dec 1969, posts, RR:
Reply 22, posted (11 years 10 months 2 weeks 2 days 6 hours ago) and read 5083 times:

Also, it is crucial to keep in mind the difference between "offsets" and bribery.

The benefits of ofsets and other side deals go to the country or the airline that they go to. The benefits of bribery - the bribe money - goes only to an official who is supposed to be making an objective decision based on his country's or his airline's interest. This why offsets, etc. are legal in most places, while outright bribes are not. The difference is who is getting paid off -the official or the country/airline?

One complaint the anti-free trade lobby in the US has made is that US companies do not demand offsets when buying from foreign sources. They act in their own interests. United did not demand an offset when buying the A320, for example. Nor can the US government offer preferential treatment in exchange for domestic aircraft orders - in fact, all ATSB loans so far have gone to big Airbus customers. But when Boeing makes similar deals oversees, offsets are demanded most of the time. And Europe constantly offers landing slots and all sorts of other preferential treatment to Airbus customers. As far as I know, even the US government does not demand offsets when purchasing goods for its own use. US suppliers are prefered by law, especially for military goods(as is the case in most nations), but when foreign suppliers must be used - the government does not demand offsets. I don't really know enough to comment on whether this charge has merit or not.


User currently offlineN79969 From , joined Dec 1969, posts, RR:
Reply 23, posted (11 years 10 months 2 weeks 22 hours ago) and read 4971 times:

Until 1998 or so, bribes were tax deductible in virtually all of Europe as business expenses. I believe they are still legal in Belgium if you can meet some legal test showing that the bribes were necessary.

User currently offlineN79969 From , joined Dec 1969, posts, RR:
Reply 24, posted (11 years 10 months 2 weeks 20 hours ago) and read 4924 times:

These shed some light on the tax-treatment of bribes:

http://www1.oecd.org/daf/nocorruptionweb/pdf/Observer/millieteinbinder.pdf

http://www.oecd.org/pdf/M00018000/M00018527.pdf


25 Fly707 : Why don't they order both Airbus & Boeing .
26 N79969 : Based on what I have read so far, Airbus has structured the deal that India will only get Airbus subcontracts if and only if both carriers go with all
27 Post contains images Cloudy : Why don't they order both Airbus & Boeing? ------ fleet commonality, silly . Use the search feature if you don't know what this means. Thanks for the
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