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Japanese Primed For 7E7 Launch

Sat Aug 30, 2003 11:57 am

In Flight International, Aug. 19-25:
ANA and JAL are expected to release tenders for 767 replacements at year-end in a contest timed with the 7E7's formal launch. Airbus is preparing a response with A330-200s but is considered a heavy underdog. Japan is preparing to designate the 7E7 a national project, resulting in government subsidies beginning in FY 2004, putting pressure on ANA and JAL to be launch customers. Japan's last national commercial aircraft project, the 777, resulted in orders from both ANA and JAL. Boeing's Japanese sales team has been discussing the 7E7 with both carriers and is confident orders will be placed early in '04.
The airlines are waiting for the 7E7's launch before issuing requests for proposals on new mid-size widebodies. As we know, the Boeing board decision on the 7E7 is due at the end of this year, authorizing the selling of the airplane. As part of the pre-launch phase, a team of 5 Japanese manufacturers is negotiating a workshare package with Boeing expected to be significant enough to merit government subsidies. Japan informally agreed to provide subsidies if its' manufacturers get a 30-35% airframe workshare.
Japan's ministry of economy & industry is preparing to submit a request for 7E7 subsidies in December as part of its' budget request to the ministry of finance for FY 2004. METI says it will seek national project status for the 7E7 and is now determining the volume of subsidies and loans to be given the manufacturers. In exchange for national project commitment, the Japan Aircraft Development Corp. expects Boeing to give its' 5 member companies at least a 35% workshare. To obtain this, Boeing must accept JADC's proposal to give Mitsubishi the wing, Kawasaki the fuselage and Fuji the center wing.
The article adds that only a few small parts of Airbus planes are made in Japan and Japanese airlines have traditionally favored Boeing, noting a recent ANA order for 45 737-700s. ANA & JAL operate a combined total of about 70 767s. Japan Air System also operates more than 30 A300s which parent JAL is considering replacing with domestic versions of the 7E7.