Boeing Focuses on Safety, Not Sales, at Paris Air Show -- 2nd Update
June 20 2019 - 1:32PM
Dow Jones News
By Robert Wall and Andrew Tangel
LE BOURGET, France -- Boeing Co. arrived at the world's largest
aerospace extravaganza battling the biggest crisis in its history.
It departs having secured a crucial vote of confidence in its
beleaguered 737 MAX jetliner and the prospect of further orders on
the horizon.
Still, the fallout from two fatal 737 crashes cast a shadow over
Boeing at the Paris Air Show -- a key industry gathering for
showcasing aircraft and securing sales -- and the U.S. plane maker
also fell behind rival Airbus SE in the race to win the emerging
market for long-range, midsize jets.
Boeing executives spent the week seeking to restore the
company's battered reputation, shunning the customary fanfare of
trumpeting billions of dollars of orders. Its focus, executives
said daily, was on safely returning the MAX to service.
"It's been a devastating set of events," Ihssane Mounir,
Boeing's head of commercial plane sales, said Thursday. "We know we
fell short."
Its efforts to reassure customers bore fruit. Boeing secured a
blockbuster sale of 200 MAX jets to British Airways owner
International Consolidated Airlines Group SA -- its first MAX sale
in months -- and Mr. Mounir said more orders for the embattled jet
were possible.
"There are customers we are talking to today" he said. "We are
engaging with several across the globe."
Airbus was left fuming over the deal. "We told IAG we would like
to bid for this business," the European plane maker's chief
commercial officer, Christian Scherer, told reporters Thursday.
Boeing didn't disclose which other customers it was talking to,
but analysts said the show had been broadly positive for the plane
maker. The company's total orders from the event are valued at more
than $30 billion before industry standard discounts.
Despite the vote of confidence from one of the world's largest
airlines, Boeing is far from over the MAX crisis. The jet still
isn't authorized to fly. And with more than 400 planes idled, the
company likely faces billions of dollars in compensation payments
to airlines, analysts estimate.
Boeing has developed a software update for the MAX to fix the
flight-control-system flaw implicated in the crashes that killed a
total of 346 people on the two planes. While regulators are poised
to start flight-testing that fix soon, it still isn't clear when
the MAX will be back in service.
Airbus largely sidestepped Boeing's woes and pressed ahead with
the launch of a new long-range version of its A321 single-aisle
plane designed to serve smaller markets, for example, on
trans-Atlantic routes.
The European plane maker won 249 orders and commitments for the
so-called A321XLR, giving it an edge over Boeing, which is
considering building a competitor jet. Airbus's deals included an
order for 50 jets from American Airlines Group Inc., providing
Airbus with an early endorsement for its plane from an important
customer. JetBlue Airways Corp. on Thursday agreed to take 13 of
them.
Boeing's Mr. Mounir said the company was, for now, focused on
the MAX, not a new plane.
Overall, through Thursday, Boeing had taken less than half the
500-plus orders it took at the previous Paris Air Show. Airbus had
secured 159 firm orders, roughly similar to the last outing.
Both plane makers are grappling with weaker demand for jets.
Neither company secured any orders for their largest, flagship
airliners at the show.
Global trade tensions that have dented airfreight demand and
falling airline profitability have also contributed to a more
modest pace of plane sales at this year's show, compared with
recent years.
Plane orders in previous years had gotten ahead of demand, and
the market is now adjusting, said Warren East, chief executive of
British aircraft-engine maker Rolls-Royce Holdings PLC.
Still, Airbus and Boeing executives insisted long-term demand
for jets remained healthy. Boeing, at the show, projected 20-year
demand from airlines for 44,040 jets valued at $3.1 trillion for
all plane makers.
Write to Robert Wall at robert.wall@wsj.com and Andrew Tangel at
Andrew.Tangel@wsj.com
(END) Dow Jones Newswires
June 20, 2019 13:17 ET (17:17 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
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