AC chooses Boeing

Really, Matthew?

Whatever could you mean? ;););)

I reckon AC chose Boeings ’cause they glide better… 😀

(Gimli Glider)

TNZ

LMAO

I reckon AC chose Boeings ’cause they glide better… 😀

(Gimli Glider)

TNZ

Weird !!!

Whats weird about this? Money talks BS walks… The planes were cheaper.

A little side note to this: AC is currently in the middle of an upswing in business due to non US passengers not wanting to make their connections to South America through stop overs in the US. Demands by Home Land Security of VISA’s, fingerprints of stopover passengers are driving business to Air Canada. As a result Air Canada has reported extra flights from the EU to South America with stop overs in Montreal, Toronto are planned.

Lately however the politics of air travel are getting ugly as HLS are demanding passenger data of all aircraft flying over the US (but not landing) which could have a great impact on both Canadian carriers as well as Mexican. In fact the release of this information to American security groups of passengers not landing in America MAY in fact be against Canadian law.

It is interesting to note that EVERY Montreal /Toronto flight (1 hour) in theroy would have to be rerouted from the current flight plan as part of the flights take place over northern New York State. In fact a lot inter-Canadian flights such as Toronto/Vancouver fly a good part of the flight plan over the US.

Perhaps Boeing may have a talk with US Government officials to relax these new security demands… One has to wonder about timing – not the AC/Boeing deal a few days before the A380 1st flight – but the new Home Land Security demands and the following week AC changing it’s fleet over to Boeing(US product)… If we see this demand quietly go away I’ll have to say politics rules again.

Just found at Aviation Week:

Air Canada Taps Boeing; ‘Two Engines Better Than Four’
04/26/2005 09:20:54 AM
By Steven Lott

Air Canada yesterday dealt a blow to Airbus’s efforts to grow its North American orderbook and win an A350 customer when the Canadian carrier inked a large deal with Boeing for potentially 100 long-haul Boeing 777s and 787s.

The carrier for several months has been evaluating aircraft to replace its mixed widebody fleet of 65 A330s, A340s and 767s. Many observers thought Air Canada was leaning toward Airbus because it already operates a large fleet of about 110 narrowbody A320 family aircraft and about 20 relatively young A330s and A340s. The airline’s management, however, found the Boeing package offered “overwhelmingly attractive economics.” The 787s will save the airline 30% in fuel burn and maintenance costs, compared with the 767s they replace, CEO Robert Milton told The DAILY.

The package includes firm orders for 18 Boeing 777s, plus options for another 18 planes. The airline will take a mix of 777-300ERs and

-200LRs, as well as two 777 long-haul freighters. The first three 777-300ERss will arrive in May, June and December of 2006, with another another eight coming in 2007. The carrier’s first -300ERs will fly on the Vancouver-Tokyo route and will also be used for London and Frankfurt. The -200LRs will be used on long-range flights to Sydney, Hong Kong and India.

The 777s will eventually replace the 10 A340-300s and the two brand-new A340-500s. The carrier technically has three A340-600s on order but has no plans to take delivery of those planes following the Boeing order. The eight A330s also will eventually be phased out of the fleet. Air Canada plans to sell the long-haul Airbus aircraft on the open market, but if it has trouble, Boeing will take the planes off its hands.

What really got management excited is the route potential for the 14 new 787s. The first deliveries aren’t planned until 2010, and the carrier has options and purchase rights for an additional 46 787s. The 223-seat 787-8 will slowly replace the carrier’s 45 767s, which will be more than 20 years old when deliveries start. The carrier also will fly the 259-seat 787-9, which will replace the A330s. CEO Robert Milton sang the praises of the 787-9, which he believes hits the “ultimate widebody sweet spot” in terms of operating economics.

While the competition for Air Canada’s order was brutal, Milton said it came down to price and economics. He said the 787 is a “game changer” and offers a “quantum leap” in aircraft technology from equipment flying today. In evaluating the Airbus offer, Milton felt the A350 was a “little larger than we wanted,” noting that the Canadian market is a “small one and highly seasonal.” The A350 was offered with about 270 seats. “It’s a bigger, heavier airplane than we need,” he told The DAILY.

Comparing the 777 and A340, Milton delivered a blow to Airbus’s aggressive campaign that “four engines are better than two.” The fact that the 777s have two engines means that it is more fuel-efficient, lighter and has lower maintenance costs than the A340, Milton claims. As part of the carrier’s analysis of the two aircraft, the airline estimated operating costs if fuel further spiked to $70 or $90 per barrel, and the two engines made a difference, he said.

GE engines will power the 777s, and the carrier will decide in the next 90 days whether it operate Rolls-Royce or GE engines on the 787s. The order is subject to several conditions, including final documentation and an agreement with the pilots on pay rates for the new planes. The companies expect to finalize the agreement by mid-year. Air Canada will soon apply for financing from the U.S. Export-Import Bank for the aircraft. The order does not require “a significant upfront cash payment,” Milton said.

Source: Aviation Daily – Air Canada Taps Boeing; ‘Two Engines Better Than Four’

Just found at Aviation Week:

Air Canada Taps Boeing; ‘Two Engines Better Than Four’
04/26/2005 09:20:54 AM
By Steven Lott

Air Canada yesterday dealt a blow to Airbus’s efforts to grow its North American orderbook and win an A350 customer when the Canadian carrier inked a large deal with Boeing for potentially 100 long-haul Boeing 777s and 787s.

The carrier for several months has been evaluating aircraft to replace its mixed widebody fleet of 65 A330s, A340s and 767s. Many observers thought Air Canada was leaning toward Airbus because it already operates a large fleet of about 110 narrowbody A320 family aircraft and about 20 relatively young A330s and A340s. The airline’s management, however, found the Boeing package offered “overwhelmingly attractive economics.” The 787s will save the airline 30% in fuel burn and maintenance costs, compared with the 767s they replace, CEO Robert Milton told The DAILY.

The package includes firm orders for 18 Boeing 777s, plus options for another 18 planes. The airline will take a mix of 777-300ERs and

-200LRs, as well as two 777 long-haul freighters. The first three 777-300ERss will arrive in May, June and December of 2006, with another another eight coming in 2007. The carrier’s first -300ERs will fly on the Vancouver-Tokyo route and will also be used for London and Frankfurt. The -200LRs will be used on long-range flights to Sydney, Hong Kong and India.

The 777s will eventually replace the 10 A340-300s and the two brand-new A340-500s. The carrier technically has three A340-600s on order but has no plans to take delivery of those planes following the Boeing order. The eight A330s also will eventually be phased out of the fleet. Air Canada plans to sell the long-haul Airbus aircraft on the open market, but if it has trouble, Boeing will take the planes off its hands.

What really got management excited is the route potential for the 14 new 787s. The first deliveries aren’t planned until 2010, and the carrier has options and purchase rights for an additional 46 787s. The 223-seat 787-8 will slowly replace the carrier’s 45 767s, which will be more than 20 years old when deliveries start. The carrier also will fly the 259-seat 787-9, which will replace the A330s. CEO Robert Milton sang the praises of the 787-9, which he believes hits the “ultimate widebody sweet spot” in terms of operating economics.

While the competition for Air Canada’s order was brutal, Milton said it came down to price and economics. He said the 787 is a “game changer” and offers a “quantum leap” in aircraft technology from equipment flying today. In evaluating the Airbus offer, Milton felt the A350 was a “little larger than we wanted,” noting that the Canadian market is a “small one and highly seasonal.” The A350 was offered with about 270 seats. “It’s a bigger, heavier airplane than we need,” he told The DAILY.

Comparing the 777 and A340, Milton delivered a blow to Airbus’s aggressive campaign that “four engines are better than two.” The fact that the 777s have two engines means that it is more fuel-efficient, lighter and has lower maintenance costs than the A340, Milton claims. As part of the carrier’s analysis of the two aircraft, the airline estimated operating costs if fuel further spiked to $70 or $90 per barrel, and the two engines made a difference, he said.

GE engines will power the 777s, and the carrier will decide in the next 90 days whether it operate Rolls-Royce or GE engines on the 787s. The order is subject to several conditions, including final documentation and an agreement with the pilots on pay rates for the new planes. The companies expect to finalize the agreement by mid-year. Air Canada will soon apply for financing from the U.S. Export-Import Bank for the aircraft. The order does not require “a significant upfront cash payment,” Milton said.

Source: Aviation Daily – Air Canada Taps Boeing; ‘Two Engines Better Than Four’

Oh surely not, J Boyle…… 😉

Oh surely not, J Boyle…… 😉

Choosing when to announce the order is, however, another matter entirely.

I’m not criticising Boeing for this – to be honest, it’s exactly what I would have done. :diablo:

My guess is Air Canada had the primary role in timing the announcement…after all, they’re signing the check!
No doubt, a lot of people shareholders/govt.officials had to be notified before hand.
Of course, Boeing may have suggested a date… 😀 😀 😀

Choosing when to announce the order is, however, another matter entirely.

I’m not criticising Boeing for this – to be honest, it’s exactly what I would have done. :diablo:

My guess is Air Canada had the primary role in timing the announcement…after all, they’re signing the check!
No doubt, a lot of people shareholders/govt.officials had to be notified before hand.
Of course, Boeing may have suggested a date… 😀 😀 😀

“Aircraft Manufacturer Sells Some Aeroplanes…..” Whatever next? :rolleyes:

“Aircraft Manufacturer Sells Some Aeroplanes…..” Whatever next? :rolleyes:

Air Canada’s top executive today intimated that Boeing slashed its pricing structure to close today’s tentative deal for up to 96 777 and 787 aircraft,
…
This declaration comes as Boeing gains ground on its rival amid accusations that a price war has erupted between the two large aircraft manufacturers.

Well…Airbus opened this can of worms…now Boeing is cracking open the barrels.

Ahhh…the free-market…you gotta love it. 😀

Air Canada’s top executive today intimated that Boeing slashed its pricing structure to close today’s tentative deal for up to 96 777 and 787 aircraft,
…
This declaration comes as Boeing gains ground on its rival amid accusations that a price war has erupted between the two large aircraft manufacturers.

Well…Airbus opened this can of worms…now Boeing is cracking open the barrels.

Ahhh…the free-market…you gotta love it. 😀

How is it wierd?

The 4 engines for the A340 use to much juice
2 engines on the 777 do not.

A350 to big, 787 is not.

Seems perfectly reasonable to me

How is it wierd?

The 4 engines for the A340 use to much juice
2 engines on the 777 do not.

A350 to big, 787 is not.

Seems perfectly reasonable to me

Weird !!!

Weird !!!

Here is some reasoning behind it….it confirms the end of the Airbus long haul fleet at AC…

Air Canada notes efficiencies, discounts in Boeing deal
Darren Shannon, Washington DC (25Apr05, 22:47 GMT, 892 words)

Air Canada’s top executive today intimated that Boeing slashed its pricing structure to close today’s tentative deal for up to 96 777 and 787 aircraft, a contract that will effectively end Airbus long-haul operations at the Canadian carrier.

Robert Milton, chief executive of the airline’s parent company ACE Aviation, will not discuss the details of the agreement, which is valued at roughly $6 million at list price. However, during an analyst call today he noted: “From my standpoint, I’m confident that no one has done better on a deal.”

This declaration comes as Boeing gains ground on its rival amid accusations that a price war has erupted between the two large aircraft manufacturers. This discount battle was emphasized this weekend when Irish budget carrier Ryanair told shareholders it was buying Boeing 737s for $50.9 million an aircraft, or almost 27% less than the top-end catalog price of $69.5 million, and was guaranteed further “price concessions” from a credit agreement.

Boeing will not comment on the minutiae of the deal, although a spokesman notes that the agreement is structured to give Air Canada freedom to adapt the order to reflect its fleet requirements. This flexibility already allows Air Canada to pick any mix of 777-200LRs and 777-300ERs (although it appears three -300ERs are committed) and 787-800s and 787-900s to satisfy the firm order, which currently stands at 16 777s and 14 787s. This policy also applies to the 18 777 and 46 787 options also included in the deal.

The only definitive part of the contract is the delivery of two Boeing 777 freighters, which are scheduled for delivery soon after the planned certification in late 2008.

It is also unclear how Air Canada will raise the requisite funds for the Boeing purchase. During the analyst call both Milton and CFO Rob Peterson said ACE Aviation is currently in talks with the US Export-Import Bank (Eximbank) to finance a major, but unspecified, part of the deal in Canadian dollars. They also said Boeing was offering support financing, but noted both deals are still under negotiation.

An Eximbank spokeswoman tells ATI that it has not received an application from Air Canada, and would usually expect formal talks to begin closer to the delivery date on any large aircraft order. She also notes that although many Eximbank aircraft deals are loan guarantees, full loans are available on sales of US-made aircraft to foreign companies.

Milton, however, today confirmed that a payment schedule had been negotiated with Boeing that allows the airline to avoid “a significant upfront cash payment”.

Air Canada also has to negotiate a new pilot contract to reduce its current two groups of long-haul pilots to one, and complete final documentation before the widebody deal can be finalized. This is expected by mid-year.

The airline is adamant the new order is in the carrier’s best interest. It currently operates five aircraft types on its long-haul routes, including eight leased Airbus A330-300s, 10 leased A340-300, two owned A340-500s and 45 owned and leased 767-200s and 767-300s.

Reducing this to a fleet of 777s and 787 will inherently offer the carrier cost savings, as older aircraft are replaced “by one of the youngest fleets in the world”. Eventually, Air Canada mainline will operate a fleet of Embraer 175 and 190 regional jets, Airbus narrowbodies and Boeing widebodies. Air Canada Jazz affiliate will operate Bombardier regional jets.

This will eventually lead to an annual $300 million increase in mainline profitability by 2010, two years after the 777s are added to the fleet and the first year of delivery for the 787.

One major factor in Air Canada’s decision to order long-haul aircraft from Boeing rather than Airbus was the European manufacturer’s four-engine model. “That had a dramatic effect on the decision,” says Milton. “In the heightened fuel cost environment” the extra weight, maintenance and consumption that comes with four engines leaves the Airbus disadvantaged, he adds.

Milton also says Airbus’ answer to the 787, the A350, was “too large” for Air Canada’s needs.

Air Canada will retain all of its widebody Airbus until 2008 as the 777s are used for growth in Asia and Europe (the first 777-300ER is already destined to serve Vancouver-Tokyo), but will begin dropping the European aircraft in subsequent years.

Notably, Milton today said the A330s and A340s will be dropped from a massive cabin upgrade program that will see $5 million invested in each of the 767s. This will be funded by a recently brokered C$300 million ($240 million) revolving credit facility.

Air Canada has also cancelled a firm order for three A340-600s as part of its shift to an all Boeing widebody fleet.

The airline plans to add the 777 passenger variants between 2006 and 2008. Three (probably -300ERs) will be delivered in May, June and December 2006, while eight will follow in 2007 (six in the first half of the year). The final eight are scheduled for delivery early in 2008.

The 777Fs are set operations in the fourth quarter of 2008. Delivery of the 787s will begin in 2010.

Air Canada will retain the higher cost 767s for the rest of the decade, says Milton, as the airline uses the new aircraft, especially the 787s, to open new longer-haul, lower demand markets in Asia, Europe and the Middle East. The 787, however, will eventually replace the carrier’s 767s.

Source: Air Transport Intelligence news

Here is some reasoning behind it….it confirms the end of the Airbus long haul fleet at AC…

Air Canada notes efficiencies, discounts in Boeing deal
Darren Shannon, Washington DC (25Apr05, 22:47 GMT, 892 words)

Air Canada’s top executive today intimated that Boeing slashed its pricing structure to close today’s tentative deal for up to 96 777 and 787 aircraft, a contract that will effectively end Airbus long-haul operations at the Canadian carrier.

Robert Milton, chief executive of the airline’s parent company ACE Aviation, will not discuss the details of the agreement, which is valued at roughly $6 million at list price. However, during an analyst call today he noted: “From my standpoint, I’m confident that no one has done better on a deal.”

This declaration comes as Boeing gains ground on its rival amid accusations that a price war has erupted between the two large aircraft manufacturers. This discount battle was emphasized this weekend when Irish budget carrier Ryanair told shareholders it was buying Boeing 737s for $50.9 million an aircraft, or almost 27% less than the top-end catalog price of $69.5 million, and was guaranteed further “price concessions” from a credit agreement.

Boeing will not comment on the minutiae of the deal, although a spokesman notes that the agreement is structured to give Air Canada freedom to adapt the order to reflect its fleet requirements. This flexibility already allows Air Canada to pick any mix of 777-200LRs and 777-300ERs (although it appears three -300ERs are committed) and 787-800s and 787-900s to satisfy the firm order, which currently stands at 16 777s and 14 787s. This policy also applies to the 18 777 and 46 787 options also included in the deal.

The only definitive part of the contract is the delivery of two Boeing 777 freighters, which are scheduled for delivery soon after the planned certification in late 2008.

It is also unclear how Air Canada will raise the requisite funds for the Boeing purchase. During the analyst call both Milton and CFO Rob Peterson said ACE Aviation is currently in talks with the US Export-Import Bank (Eximbank) to finance a major, but unspecified, part of the deal in Canadian dollars. They also said Boeing was offering support financing, but noted both deals are still under negotiation.

An Eximbank spokeswoman tells ATI that it has not received an application from Air Canada, and would usually expect formal talks to begin closer to the delivery date on any large aircraft order. She also notes that although many Eximbank aircraft deals are loan guarantees, full loans are available on sales of US-made aircraft to foreign companies.

Milton, however, today confirmed that a payment schedule had been negotiated with Boeing that allows the airline to avoid “a significant upfront cash payment”.

Air Canada also has to negotiate a new pilot contract to reduce its current two groups of long-haul pilots to one, and complete final documentation before the widebody deal can be finalized. This is expected by mid-year.

The airline is adamant the new order is in the carrier’s best interest. It currently operates five aircraft types on its long-haul routes, including eight leased Airbus A330-300s, 10 leased A340-300, two owned A340-500s and 45 owned and leased 767-200s and 767-300s.

Reducing this to a fleet of 777s and 787 will inherently offer the carrier cost savings, as older aircraft are replaced “by one of the youngest fleets in the world”. Eventually, Air Canada mainline will operate a fleet of Embraer 175 and 190 regional jets, Airbus narrowbodies and Boeing widebodies. Air Canada Jazz affiliate will operate Bombardier regional jets.

This will eventually lead to an annual $300 million increase in mainline profitability by 2010, two years after the 777s are added to the fleet and the first year of delivery for the 787.

One major factor in Air Canada’s decision to order long-haul aircraft from Boeing rather than Airbus was the European manufacturer’s four-engine model. “That had a dramatic effect on the decision,” says Milton. “In the heightened fuel cost environment” the extra weight, maintenance and consumption that comes with four engines leaves the Airbus disadvantaged, he adds.

Milton also says Airbus’ answer to the 787, the A350, was “too large” for Air Canada’s needs.

Air Canada will retain all of its widebody Airbus until 2008 as the 777s are used for growth in Asia and Europe (the first 777-300ER is already destined to serve Vancouver-Tokyo), but will begin dropping the European aircraft in subsequent years.

Notably, Milton today said the A330s and A340s will be dropped from a massive cabin upgrade program that will see $5 million invested in each of the 767s. This will be funded by a recently brokered C$300 million ($240 million) revolving credit facility.

Air Canada has also cancelled a firm order for three A340-600s as part of its shift to an all Boeing widebody fleet.

The airline plans to add the 777 passenger variants between 2006 and 2008. Three (probably -300ERs) will be delivered in May, June and December 2006, while eight will follow in 2007 (six in the first half of the year). The final eight are scheduled for delivery early in 2008.

The 777Fs are set operations in the fourth quarter of 2008. Delivery of the 787s will begin in 2010.

Air Canada will retain the higher cost 767s for the rest of the decade, says Milton, as the airline uses the new aircraft, especially the 787s, to open new longer-haul, lower demand markets in Asia, Europe and the Middle East. The 787, however, will eventually replace the carrier’s 767s.

Source: Air Transport Intelligence news