Reggaebird
Topic Author
Posts: 886
Joined: Tue Nov 02, 1999 7:43 am

Boeing Trying To Change South African's Choice

Tue May 21, 2002 9:07 pm


Hi all,

I was reading a very interesting article from an African business magazine which said that Boeing is secretly working behind the scenes to overturn South African Airways' recent decision to replace the majority of its Boeing fleet with Airbus aircraft.

The article said that Boeing's loss of this important customer was not due to product or pricing considerations. The main issue was that the South Africans were reacting to the botched (and some say illegal) selection process that resulted in an order for Boeing 737-800's in the late 1990's. It seems that the former CEO of SAA was American and pushed through the order for American aircraft. Apparently, Boeing has quietly acknowledged the problems from the previous order and has been forgiven by the SAA leadership. As a result, they are now in a better frame of mind to consider Boeing's products.

The article went on to say that Boeing is proposing a mixture of 777's (-200ER and -200LR), 767's (-300ER and/or -400ER) and 757's (-200) for the bulk of SAA's needs. In addition, SAA is seriously interested in the new 747XQLR as a longer term replacement for it's ageing fleet of 747-400's.

I was stunned to learn about this activity! I have heard about failed and successful attempts to change fleet decisions before but never anything on this scale. I also wondered what, if any, penalties the airline would incur and whether Boeing would absorb those penalties.

Although I am a major Boeing fan, I wonder if this kind of activity is good for the company in the long run. If they are doing this now, can Airbus be far behind? What will it do to the industry if orders are not as "firm" as they used to be?

 
777236ER
Posts: 12213
Joined: Sat Aug 18, 2001 7:10 am

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 9:42 pm

I wonder if this kind of activity is good for the company in the long run. If they are doing this now, can Airbus be far behind? What will it do to the industry if orders are not as "firm" as they used to be?

This has always gone on. It'll be better for Boeing in the long run with a 100 plane order than being "moral".
Your bone's got a little machine
 
Guest

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 9:54 pm

I think we can trust in SA's management to make a decision which is right for their airline....in that context, it doesn't really matter whether Boeing or Airbus are trying to secretely dissuade SA from opting one or the other-they will make a choice which makes sense to their particular operation, and that is the end of the story.

Cheers
 
aerosol
Posts: 497
Joined: Mon Oct 23, 2000 10:31 pm

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 11:12 pm

April again?
Sorry but I can`t take these news (SQ, Qantas and others) serious anymore!
 
travellin'man
Posts: 469
Joined: Sun May 13, 2001 1:55 am

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 11:36 pm

The 738's were also controversial for the silly reason that they didn't get the right seats for them initially, maybe just in business class, and so passengers complained about comfort level, and grew to dislike the plane. I say silly because that seems to be a fairly fixable problem. Maybe there was more under the surface, as everyone is pointing out here.
It is not enough to be rude; one must also be incorrect.
 
Reggaebird
Topic Author
Posts: 886
Joined: Tue Nov 02, 1999 7:43 am

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 11:47 pm

Aerosol,

I do not understand what you were trying to say. Please clarify, if possible.

 
Arsenal@LHR
Posts: 7510
Joined: Tue Mar 20, 2001 2:55 am

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 11:52 pm

SAA is seriously interested in the new 747XQLR as a longer term replacement for it's ageing fleet of 747-400's.

I wouldn't say they're ageing, some are realtively new while some are in mid-life, but not ageing.  Smile

Arsenal@LHR
In Arsene we trust!!
 
Guest

RE: Boeing Trying To Change South African's Choice

Tue May 21, 2002 11:55 pm

I hope Boeing can persuade SAA to change their mind and go for the 777-200ER with RR Trent 800s instead of the sluggish CFM56-5C powered A340-300.
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 12:09 am

There was more than met the eye for the SAA order. I read that the Airbus order was part of a broader government initiative to improve relations with Europe. This was according to the aerospace analyst at Goldman Sachs. I cannot remember his name. The whole business about people not liking the 738 was weird. They got rid of the A320s for 738 and now are returning to the 320.
 
MD-11 forever
Posts: 550
Joined: Wed Mar 14, 2001 12:15 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 12:12 am

TEDSKI
What's your problem with the "sluggish CFM56-5C powered A340-300"? You're talking about a plane that serves several major airlines like CX, AF, LH and so on pretty well. Also, thes "sluggish" engines are pretty well if it comes to economy to operate them. I'm kind of fed up with these posts about the so called underpowered A340-300!!! Besides that, it hasn't got anything to do with the topic....
Bacvk to topic, I guess it's a part of the business game they are playing now, but to me it seems as if Boeing is becoming desperate to sell their planes at any cost...... Also it seems that an order once knows as "firm" has stopped to exist in this business?
Just my humble idea...

Cheers, Thomas
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 12:22 am

I misspoke earlier but not by a lot. Here is the article I was referring to:

http://archives.seattletimes.nwsource.com/cgi-bin/texis.cgi/web/vortex/display?slug=boeing080&date=20020308&query=south+african
 
Areopagus
Posts: 1327
Joined: Thu Sep 20, 2001 12:31 pm

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 12:25 am

What was claimed to have been illegal? If the problem is that the former CEO of SAA was American and pushed through the order for American aircraft, then that's not exactly Boeing's fault. If Boeing has quietly acknowledged the problems from the previous order and has been forgiven by the SAA, then there must have been something in particular that they are alleged to have done wrong. Does anyone in this forum know?
 
Reggaebird
Topic Author
Posts: 886
Joined: Tue Nov 02, 1999 7:43 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 12:26 am

Arsenal@LHR,

Thanks for pointing out the issue with the "ageing" phrase. However, I did mention that the 747XQLR's were of "longer term" interest, i.e. not immediately.

It should be noted that the first four 744's in SAA's fleet are now about 10 or 11 years old. At 15 years old, they are officially classified as "ageing" and will require special ageing aircraft maintenance. With that in mind, I really wasn't that far off.  Smile/happy/getting dizzy

 
BA DC-10
Posts: 140
Joined: Sun Jul 15, 2001 8:40 pm

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 1:25 am

SAA management will have chosen airbus aircraft for their performance, economy and reliability, which in the long run are more important than the initial ouput. Whether airbus or boeing aircraft are better than each other, SAA made that decision, and after commiting so much i fail to see how it would benefit SAA to change the order.

 
Guest

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 1:53 am

The South African government - like just about every other African government - is incredibly corrupt. The ANC jumped on the gravy train on 27 April 1994 and it's gaining momentum on a daily basis.

Interestingly, it was Andersen (yep, as in Enron!) that recommended to SAA's board that they should go Boeing. Unfortunately, the -800 is not a hot and high performer and they have been an absolute disaster in every way for SAA.

I am sure that if Boeing offer the right "incentives" to various government ministers (4WDs are very popular there!  Big grin ) then they will get the contract ... until Airbus offer them more.

If you can't take a joke, don't come to Africa! Big grin Big grin Big grin

 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 2:06 am

After China Airlines it is now SAA. I wonder were people keep getting these stories from. BTW, any news on the 10 777-300s that were due to replace Virgin Atlantic's 10 A340-600s?  Big grin

It looks like every big airline is interested in the 747WATHEVER, but no one is ordering it! Big grin

Let me predict who's next. Qatar Airways is seriously interested in the 747WATHEVER and the Sonic Cruiser, it seeks to replace the ordered A380 and A330 aircraft with these fine Boeing products. After Bush secretly admitted that he is a muslim the board of Qatar has changed her mind about the fleet renewal. Big grin  Smile Big grin

SUPPORT THE LEBANESE CIVILIANS
 
LJ
Posts: 4127
Joined: Wed Nov 17, 1999 8:28 pm

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 2:10 am

I hope that SA sticks with the A320s. Those lovely ex-SA B737-800s look very good in Transavia livery.  Big grin
 
GDB
Posts: 12653
Joined: Wed May 23, 2001 6:25 pm

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 3:11 am

I understood that SAA also have A340-600's on order, as well as 'sluggish' A340-300's.
Still, SAA cannot know anything about hot and high requirements can they?
 
qatarairways
Posts: 864
Joined: Sun Sep 07, 2008 6:02 pm

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 3:36 am

I don't think that SAA will change thier minds. We keep hearing these stories with VS, CI, QF, SQ and now SAA.

Manni,
Actually Qatar Airways have said that they will buy the Sonic Cruiser if Boeing's promises are true.


Regards,
QatarAirways
Aviation Gulf
 
SA-JET
Posts: 280
Joined: Wed May 24, 2000 7:51 am

RE: SAS23

Wed May 22, 2002 4:05 am

Just for the record; the last time a European company (Daimler Chrysler) tried to "persuade" some government officials to purchase certain equipment (army) and offered 4wd cars-the entire thing blew up so badly, some are still trying to recover from the fallout. The Daimler CEO for Southern Africa has been fired and is back in Germany awaiting trial on charges of fraud.(as well as in SA) The government official who took the heat is ANC ex-chief parliamentary whip Tony Yengeni-who was fired. So, 4wd presents might work in other parts of Africa, but NOT in my country!!
All this crap about Boeing now trying to persuade high gov officials to now cxl a multi billion dollar deal and go Boeing...please.
 
JAL
Posts: 3876
Joined: Sun Apr 30, 2000 12:37 pm

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 4:45 am

I hope that this is true.
Work Hard But Play Harder
 
Reggaebird
Topic Author
Posts: 886
Joined: Tue Nov 02, 1999 7:43 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 7:00 am

Qatarairways,

You should remember that Boeing successfully overturned SQ's committment to the Airbuse A340-300. The whole fleet is being progressively replaced by Boeing 777's.

 
Setjet
Posts: 1140
Joined: Fri Mar 15, 2002 12:54 am

RE: Boeing Trying To Change South African's Choice

Wed May 22, 2002 11:03 am

"After China Airlines it is now SAA. I wonder were people keep getting these stories from. BTW, any news on the 10 777-300s that were due to replace Virgin Atlantic's 10 A340-600s?"

Manni: Just read the initial post and you will see where people (in this case Reggaebird) get these stories (in that case from an African Business Magazine).

"Unfortunately, the -800 is not a hot and high performer and they have been an absolute disaster in every way for SAA."

SAS23: The 737NG can't be bad in "every way" for SAA, they are using the -200 almost since it was introduced. Although you might be right that it isn't a hot and high performer, can you prove your point by comparing it to the A320 please?
 
saa737-244
Posts: 30
Joined: Fri Jan 14, 2000 4:57 am

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 5:00 am

SAS23's comments earlier cannot go unchallenged, as they are either speculation, opinion, or just plain incorrect:

The South African government - like just about every other African government - is incredibly corrupt. The ANC jumped on the gravy train on 27 April 1994 and it's gaining momentum on a daily basis.

Not exactly on topic, but sure, there are some corrupt officials here - one reads about them occasionally in the free press that we have in South Africa, when they are exposed and arrested. Corruption is a crime in this country, as several jailed officials caught on the take can testify. The incidence of it is no more prevalent than in other developing countries of similar economic strength.

Interestingly, it was Andersen (yep, as in Enron!) that recommended to SAA's board that they should go Boeing.

That is not correct. The company consulting SAA on the shorthaul fleet choice that resulted in the 738 order was Bain & Co, American CEO Coleman Andrews's old firm. An old friend of mine was working for Bain in Johannesburg at the time, and was involved in this.

Unfortunately, the -800 is not a hot and high performer and they have been an absolute disaster in every way for SAA.

An exaggeration, in both respects. There are two main problems with the 738 in SAA service (the second being a partial spinoff of the first), neither of which has been mentioned here: cargo container capability & capacity; and turnaround times.
Much of the pressure on SAA to switch back to Airbus aircraft has come from freight companies which used to rely on SAA's A300s and A320s to transport their perishables intercity in the past. The 738s don't take the LD3 containers used in that industry, whereas the A320/319 can (in 46W form).
When SAA's management said that the 738 hadn't lived up to expectations they were referring specifically to the turnaround time issue.
These problems are common knowledge in SA aviation circles.
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 5:08 am

Thanks for filling in the missing facts.
 
Udo
Posts: 4288
Joined: Tue May 18, 1999 5:16 pm

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 5:24 am

I have nothing to add here, except.... Yawn Yawn Yawn Yawn Yawn
Me & You & a Plane Named Blue...
 
Joni
Posts: 2613
Joined: Thu Aug 10, 2000 11:05 pm

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 7:13 am


Trying to recover already lost tenders is routine in many industries. It rarely works, of course, but it's worth the try.

 
Klaus
Posts: 20622
Joined: Wed Jul 11, 2001 7:41 am

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 8:20 am

...and floating rumours about it can help persuading your next prospective customer, of course...  Wink/being sarcastic
 
Alessandro
Posts: 4962
Joined: Wed Sep 12, 2001 3:13 am

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 8:37 am

So does the US invest in SA? I know that Ford assembles cars in SA, but compared with VW,BMW and Daimler-Chrysler its not much ,can this
be a part of the decision to go for Airbus, to attract more investment in SA?
Did the Boeing deal attract any US investment in SA?
From New Yorqatar to Califarbia...
 
cba
Posts: 4228
Joined: Sat Jul 15, 2000 2:02 pm

RE: Boeing Trying To Change South African's Choice

Sat May 25, 2002 9:04 am

"Unfortunately, the -800 is not a hot and high performer and they have been an absolute disaster in every way for SAA".

I recall that SAA ditched the A320 because it was not a good hot and high performer. The A320 (especially the IAE powered variant) has had problems when it comes to hot and high climates and short runways. I hear thet UA can't get a full A320 out of LGA.

Now, when I flew the 73G, I recall that it climbed like a rocket out of IAH in July (100 degrees outside).