Boeing Lands 200 7E7 Down Payments

NYC777 · Thu Sep 23, 2004 11:12 pm

Not an old article. But hearing a lot of different takes on this topic. I certainly hope the 200 number is correct!

http://money.cnn.com/2004/09/23/news/fortune500/boeing.reut/

NYC777 · Fri Sep 24, 2004 3:49 am

According to this article the airlines that have placed deposits will be revealed over the next 14 weeks. This is going to be good.

nosedive · Fri Sep 24, 2004 4:11 am

And the "Who has ordered the 7e7" threads will become as common as the When will NW retire the DC9 threads over the next 14 weeks.....

Because, as the article also mentions, down payments are refundable, does this mean that down payments ensure production slots??

kl911 · Fri Sep 24, 2004 4:14 am

Personally I don't believe it. Let's wait till it's official. Most likely a 'smart' Boeing publicity stunt.

KL911

rjpieces · Fri Sep 24, 2004 5:15 am

Most likely a 'smart' Boeing publicity stunt.

And you are basing this on.........?

Many airlines are not ready to order the 7E7 but want to be able to secure early delivery slots or know they will be ordering it in the future. Down payments are an easy way to do this, and hopefully they get a better deal.

I have heard rumors from a good source that American has deposits on 7E7s..........It would not surprise me at all if many airlines such as SQ had deposits on the 7E7.

DLKAPA · Fri Sep 24, 2004 5:24 am

It's gonna be USAirways in a daring revival plan.

gaut · Fri Sep 24, 2004 5:31 am

Well; it's a very good news for Boeing Its very impressive for a "paper" airliner... I honestly think that the 7E7 will be a great aircraft and a very good seller. Those months will be exciting....

Regards

Gaut

frugalqxnwa · Fri Sep 24, 2004 6:09 am

My guess on airlines who have put down deposits:

NW/KLM
SQ
JAL
many airlines in China

more remote possibilities:

AA
CO
CX
Air China
Korean
LH
AF

NWDC10 · Fri Sep 24, 2004 6:25 am

I don't believe it either. Boeing should name the airlines now instead of "waiting " for the announcement. I don't believe they will get 200 orders by years end. Robert NWDC10

IAHtown · Fri Sep 24, 2004 6:32 am

Haven't four of those orders already been revealed to be to Vietnam?

NYC777 · Fri Sep 24, 2004 6:41 am

Boeing should name the airlines now instead of "waiting " for the announcement.

Boeing allows the customer to determine the timing of the announcement of new orders so they cannot come right out and say XYZ airline ordered 20 7E7s. Those airlines would be more than a little pissed. Also many of these airlines are probably still trying to workout issues with Boeing and engine manufacturers before preceding to announce the order.

skymileman · Fri Sep 24, 2004 7:03 am

Why can't Boeing announce the orders immediately? They know who the customers are, so why can't the public? Boeing just thinks they're being cute with this little "Suspense Game." I love Boeing, but I hate suspense.

jetjack74 · Fri Sep 24, 2004 7:07 am

Probably because of Privacy Act statements. The airline holds the discretion as to when to announce orders, since it's their money that's being spent.

NYC777 · Fri Sep 24, 2004 7:08 am

Again, the airlines dictate when they want the orders to be announced. Sure Boeing knows who's ordering what and how many but they don't want to piss off the customer who will be ordering it. Same goes for Airbus. No supplier wants to piss off their customer.

gigneil · Fri Sep 24, 2004 7:09 am

Boeing can't announce anything without the permission of their customers. They could remain unidentified forever if they wish.

N

EnviroTO · Fri Sep 24, 2004 7:15 am

I read somewhere that Air Canada is likely to replace its 767s with 7E7s eventually wanting to keep at least one Boeing type but I doubt they would be putting money down on that right now. Of course, I could be wrong, their plan is do increase the amount of international flying they do and maybe they will need the aircraft sooner.

Btblue · Fri Sep 24, 2004 7:42 am

Perhaps Boeing may want to wait a while for a reason..... You never know they may issue a press release closer to the time that the A380 is due to fly - that would make some kind of sense in terms of Marketing!

I can't wait to see the 7E7 it's going to be a fab aircraft with really innovative technologies.

AEROFAN · Fri Sep 24, 2004 8:22 am

my gaaaaaaaaawwwwwwwddddddd - two Europeans actually are favourable towards a boeing product!!! Am I on the correct forum!!!! be still my heart !! Smile

flyabr · Fri Sep 24, 2004 8:34 am

check out this article:

http://seattlepi.nwsource.com/business/191815_boeingorders22.html

boeing is now saying they expect orders for about 100 7e7s by the end of 2005! that's quite a change from earlier announcements...maybe airbus has dangled that a350 cheese in front of some interested airlines afterall...

bennett123 · Fri Sep 24, 2004 8:38 am

I do not think that there is as much hostility to Boeing products in Europe as you suggest.

Have you ever consider how many European Airlines buy some or all of their fleets from Boeing.

I think that some of the statements made by Boeing tend to grate a little sometimes on this side of the pond. Whilst Boeing may seem to imagine that a world without Airbus would be a good thing, these sentiments do not play well in Europe.

American business leaders seem to think that saying that "he is going to kick someones arse" sound macho. European business leaders do not make this type of statement, because they tend to come across as arrogance.

magyar · Fri Sep 24, 2004 9:02 am

Anybody can tell me why the airlines who paid the refundable deposit
DO NOT want to be named?!?
What advantage this would mean to them?
Why so many costumer want to stay in the shadow?
Lately I became skeptical about what Boeing says. Do you
remember the "Sonic Cruiser" that should have revolutionized the
aviation! Or so said Boeing.

yyz717 · Fri Sep 24, 2004 9:56 am

I read somewhere that Air Canada is likely to replace its 767s with 7E7s eventually

Actually, Robert Milton, the current bankrupt-era CEO, mused aloud that AC might be interested in the 7E7 at some future stage. Given his tenure as the man at the helm when AC dived into bankruptcy, his public comments on the 7E7 are worthless.

DfwRevolution · Fri Sep 24, 2004 10:11 am

Anybody can tell me why the airlines who paid the refundable deposit DO NOT want to be named?!?

Airlines always keep order negotiations on the down low, except for AI and look what happens to them. It's simple business practice.... a need-to-know basis that in the long-run protects the customer from being unduley pressured in any direction.

Check how many "unidentifyied" customers Boeing has had in the last five years, it is well within a customer's right to refrain from disclosing order details-

http://active.boeing.com/commercial/orders/displaystandardreport.cfm?optReportType=Order&optDateRange=Specific&cboStartMonth=01&cboStartYear=1999&cboEndMonth=08&cboEndYear=2004&optCustInfo=Customer&cboCustomerName=UNK&cboCountryName=&cboRegionName=&optModelInfo=CurrentModels&cboCurrentModelName=AllModels&cboAllModelName=&cboAllMinorModelName=&optSort=Model&ViewReportF=View+Report

Do youremember the "Sonic Cruiser" that should have revolutionized the aviation!

Yeah... the 7E7 is a direct descended of the Sonic Cruiser smart one Yeah sure

The Sonic Cruiser was a proof of concept study that incompassed models ranging from 180-300 seats at speeds of Mach .9 - Mach 1.5 as well as super efficent subsonic models. In January 2001, Boeing ended up marketing a 200-250 seat aircraft with a cruise of Mach .98 and 9,000nm+ range with 767 opperating cost. This didn't attract much interest, so Boeing back peddled to the super efficent concept.

In January 2003, Boeing began marketing a 200-250 seat aircraft with Mach .85 cruise, 8,500 nm range, radically improved opperating cost, and broad market appeal. The interest and demand from airlines couldn't be higher, hell it's sold 62 copies in 9 months. Contractors have been awarded, airlines have signed firm order contracts, this is as real as it gets buddy......

Falcon84 · Fri Sep 24, 2004 10:16 am

Most likely a 'smart' Boeing publicity stunt.

Anyone who thinks a corporation like Boeing would stake it's rep on a publicity stunt, and not have this lined up, needs to have their sanity checked.

sllevin · Fri Sep 24, 2004 11:18 am

They could remain unidentified forever if they wish.

I'm thinking that when they finally fly one into LAX their cover will get blown Smile

Steve

AFROTC · Fri Sep 24, 2004 11:32 am

Why can't Boeing announce the orders immediately? They know who the customers are, so why can't the public? Boeing just thinks they're being cute with this little "Suspense Game." I love Boeing, but I hate suspense.

Sorry buddy but the public does not need to know what a private company( i think its private) is doing or who their customers are.

a little humor for ya
http://www.funnyjunk.com/pages/ghettodelta.htm

HlywdCatft · Fri Sep 24, 2004 11:49 am

***""And the "Who has ordered the 7e7" threads will become as common as the When will NW retire the DC9 threads over the next 14 weeks.....""***

Just wait until they turn into NW is replacing its DC-9s with 7E7s

rparker537 · Fri Sep 24, 2004 1:29 pm

Airlines have many reasons for not permitting Boeing (or Airbus) to announce orders until they're good and ready. They can be primarily divided into 2 strategic areas - internal (e.g., completing negotiations over existing and new pay rates and scales, engine selection) and external (competitors, marketing, upcoming earnings / setting shareholder expectations low).

jasepl · Fri Sep 24, 2004 1:33 pm

Didn't we discuss on another topic some time ago how the deposit was really an insignificant amount and airliners could be making the payment just to hold the delivery slots?

Ruscoe · Fri Sep 24, 2004 2:32 pm

I reckon that over the next 14 weeks Boeing is going to ask those customers who have placed refundable deposits to firm up their committment by converting to a non refundable LOI or even order. As they do they will probably be announced.

Ruscoe

aeronuts · Fri Sep 24, 2004 3:18 pm

Putting refundable deposit on 7E7 to guarantee production slot is cheap insurance. Think about it this way, if DL announced that they've placed a large orders for the 7E7, the management will catch S^&% for the order in the face of potential Chapter 11 or asking labor for more cuts... Just another reason why...

AF-A319 · Fri Sep 24, 2004 3:19 pm

It's a common strategy in any industry to announce a high number of orders when introducing a new standard. And by many aspect, a new a/c is a new standard, with many complementary goods coming in (think of engines, spare parts, galleys, equipments and so on).

Think of the video game console industry. Everytime a new player comes in (whether MS, Nintendo, or Sony), they do their best to make people think their console has already been pre-ordered by many customers. So that potential customers are ensure they'll get enough complementary quality complementary goods (games) and enough partners to play with (other customers).

It's the same in the airline industry. You don't want to buy a product that only ANA (with a strong political influence), and two minor charter European carriers have purchased. So, it's Boeing best interest to overstate the number of orders they got, so more airlines comes in.

Communication is Success

Joni · Fri Sep 24, 2004 4:50 pm

They've said before that they have "interest" in the 7E7 from many airlines. They still don't have many orders, so of course they have to make noises of anything they do have. This should IMO be considered an effort to muddy the waters on the actual order situation, as was done some years back by counting also options as "orders".

On this board, we still count orders only.

AvObserver · Fri Sep 24, 2004 5:17 pm

This won't immediately translate into the once hoped for (or hYped for) 200 FIRM orders but it's encouraging and we still might see around 100 firm orders by THIS yearend, instead of 2005 as stated in another thread. It's not a given but usually, such deposits eventually do translate into firm orders.

Adria · Fri Sep 24, 2004 5:21 pm

"Anyone who thinks a corporation like Boeing would stake it's rep on a publicity stunt, and not have this lined up, needs to have their sanity checked."

What about the revolutionary Sonic cruiser? Wasn't that a publicity stunt? And after the tanker deal Boeings rep is pretty much in the a**

warren747sp · Fri Sep 24, 2004 8:27 pm

Right, Adria?
I don't believe any announcement about deposits and firm orders was ever given for the Sonic Cruiser, so where is the comparison?
The final details or even any contract for the Tanker deal is still in the air, so don't jump your gun too early on Boeings reputation much to your delight.

su184 · Fri Sep 24, 2004 8:44 pm

100 orders by year end seems more realistic unless two more airlines place ANA-sized orders, I think it seems unlikely but manufacturers have their ways to convince airlines to place orders so that they can be counted by year end.

Adria · Fri Sep 24, 2004 8:57 pm

"I don't believe any announcement about deposits and firm orders was ever given for the Sonic Cruiser, so where is the comparison?"

My point is that it is one thing what Boeing is saying and the other what they are doing. From the moment when Airbus started the A300 programe they were bashing it with stupid comments and it looks like the Boeing management didn't learn anything from the past. At the time the A320 was developed exact the same comments were given as now during the A380 development. And look the A320 family is the fastest selling aircraft family today!

"The final details or even any contract for the Tanker deal is still in the air, so don't jump your gun too early on Boeings reputation much to your delight." And why was the Boeing management changed(by your opinion)?

N79969 · Fri Sep 24, 2004 9:02 pm

To those of you think this is a ploy by Boeing to "muddy the waters" or this is a "publicity stunt" should think about it a little more. Boeing is not simply going around to air shows or holding press conferences with a fiber glass model and power presentation to distract people from an Airbus product.

This time they are publicly announcing that they have received cash and expect future revenues in the billions of dollars. These are factors that drive stock valuation and thus Boeing faces the risk of very expensive lawsuits if these remarks by Stonecipher are too far off the mark. In other words, Stonecipher et al must feel pretty confident in what he is saying.

The deposits are refundable so some of these will not evolve into orders but I think a relatively high percentage will.

AF-A319,

I think you are talking about network effects which does apply to software but does not fit as well in this case.

Adria · Fri Sep 24, 2004 9:09 pm

"Boeing is not simply going around to air shows or holding press conferences with a fiber glass model and power presentation to distract people from an Airbus product."..........That is exactly what they were doing with the Sonic Cruiser. You couldn't have said it better Smile

. Everyone that knows something about aerodynamics knew that this project is impossible(in terms of economics due to the high Mach speed).

N79969 · Fri Sep 24, 2004 9:12 pm

Adria,

And that is exactly what Airbus is doing now with the A350 and what they did with their proposed competitor against the Sonic Cruiser.

Adria · Fri Sep 24, 2004 11:18 pm

the A350 is going to happen and Airbus didn't needed to get attention with a Sonic Cruiser competitor(they have just asked the airlines if there is real interest, they didn't offer anything). The 7E7 itself with this shark tail and the Embraer nose, is just to get the media attention. The real model will look like any other aircraft today. It is a real problem to get attention these days for Boeing. Airbus(delivering more aircraft then Boeing) is building the biggest civil jet in the world and it is totally natural that the whole aviation world is focused to Europe. That is why there are articles about how the A380 is a mistake and that is why we have a 737 flying in the 7E7 colors. Boeing just wants attention.

NYC777 · Fri Sep 24, 2004 11:40 pm

The 7E7 itself with this shark tail and the Embraer nose, is just to get the media attention. The real model will look like any other aircraft today

And you know this how? Boy being in Antartica must mean you're really out of touch with the real world. The 7E7 is being designed, Boeing has suppliers lined up and has orders with more on the way. And is the 350 (if that is what it is) how far along...not far at all. Boeing dosen't need to to do the things it does for attention...it's trying to sell airplanes.

[Edited 2004-09-24 16:44:43]

N79969 · Fri Sep 24, 2004 11:43 pm

Adria,

Actually if you look back, Boeing actually did shop the Sonic Cruiser around and did begin some engineering work. When they realized that speed was not what airliners were interested in they shifted gears and went for economy which is more popular. It was not as much of a phantom project as you choose to believe. I would agree that Boeing timed some of their announcements to take the spotlight off of the A380...very similar to the A350 marketing now. Airbus also rolled out a artist's concept of a Sonic Cruiser competitior...I doubt that Airbus actually showed much beyond that to any customers.

It is far from clear whether the A350 will happen. Where are they going to get the money? The A380 is a massive project that is consuming vasts amounts of corporate resources. Surely the company delivering more airplanes will not have to ask for more free or near free government money to challenge a smaller company.

I willl not comment on your last remark about the A380 and 737 in 7e7 colors as we are already pretty far off topic.

I got in this thread because a couple of people have implied that Boeing's announcement of customer deposits is a bluff or publicity stunt of some kind. I explained in reply 39 why in all likelihood it is probably not. Do you care to respond to what I have said or do you want continue discussing the PR antics of Boeing while pretending that Airbus does not engage in such tactics.

[Edited 2004-09-24 16:45:52]

boeingbus · Sat Sep 25, 2004 12:09 am

"the A350 is going to happen"

says who? I haven’t read a press release that Airbus launched this project.

"Airbus (delivering more aircraft then Boeing) is building the biggest civil jet in the world"

So Boeing experienced a hiccup due to poor management... The ‘biggest civil jet in the world’ created by the European Airbus but composed of 30% American or 40% if PWGE engines - yeah right.

"and it is totally natural that the whole aviation world is focused to Europe."

The whole aviation world??? haha... hmm… Airbus has been logging orders for about 3 years and a dismal 130 orders later (most orders are for one airliner) and you say the whole world?

"That is why there are articles about how the A380 is a mistake and that is why we have a 737 flying in the 7E7 colors. Boeing just wants attention."

Oh, Boeing hurt’s your feelings? Don’t like competition? There are the similar 7E7 bashing articles and news conferences from Airbus. This is healthy competition... get over it...

Lucifer · Sat Sep 25, 2004 12:18 am

In many cases, stock market listing rules will dictate when or not such announcements must be made. To reveal such downpayments would cause unwanted and unintended city reactions, which mut be avoided. Further announcements are in some cases illegal by SEC listing rules.

Rj111 · Sat Sep 25, 2004 2:01 am

I must admit im becoming very sceptical about these 200 deposits and whether they are A) real and B) actually result in 200 planes. Boeing have been ranting on about this for a while now, something doesnt add up. Nethertheless time will tell.

Anyone who thinks a corporation like Boeing would stake it's rep on a publicity stunt, and not have this lined up, needs to have their sanity checked.

Boeing can't announce anything without the permission of their customers. they could remain unidentified forever if they wish.

Interesting...

NYC777 · Sat Sep 25, 2004 2:09 am

I must admit im becoming very sceptical about these 200 deposits and whether they are A) real and B) actually result in 200 planes. Boeing have been ranting on about this for a while now, something doesnt add up. Nethertheless time will tell.

NYC777: Welllll, maybeeeee they're still negotiatiing the terms of the contracts and thus they don't want to announce an order that isn't even firmed up.

Rj111: Ahh what an interesting thought!!! I never thought that an airline would want to wait to announce an airplane purchase until they've signed the contract or at least an LOI. Wow you're sooooo smart!!!!!!

N79969 · Sat Sep 25, 2004 2:14 am

Rj111,

If your 'hunch' is correct, then Boeing will pay a very heavy price as I point out in reply 39 and Lucifer points out again in reply 45. If you were in Boeing's shoes, would you take such a huge risk by making such claims in an interview just for kicks?

When you say something doesn't add up, what exactly are you calculating?

[Edited 2004-09-24 19:16:27]

Adria · Sat Sep 25, 2004 2:16 am

"So Boeing experienced a hiccup due to poor management... The â€˜biggest civil jet in the worldâ€™ created by the European Airbus but composed of 30% American or 40% if PWGE engines - yeah righ".............hmmso what about the 7E7. Do you think it is an American product(30% by Boeing and 70% by foreign companies)? But this is not the point. I just wanted to point out that those Payments could be a "publicity stunt" as it was with the Sonic Cruiser. You have to read a post more slowly maybe that will help you to understand what I want to say

And by "the whole aviation world" I mean the media,airlines,..........Not just launch customers.

Myc777: I never said that the 7E7 is not in the development stage. All I said that it WILL look like any other conventional airliner(based on the pics that were made during the wind tunnel tests). And sooner or later Airbus will have to develop a new model for the A310/330 replacement so the so-called A350 will eventually come.

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