Qantas Airways is very likely to exercise its option to buy another 50 Boeing 787s on top of an existing order of 65 planes, the company's chief financial officer said on Wednesday.
The airline, the world's eighth-biggest passenger airline by market value, also hopes to decide in the coming months on new ultra long-range jets, Qantas Chief Financial Officer Peter Gregg said.
In December, the Australian carrier announced it would buy 65 Boeing 787s for more than USD$10 billion, with the option to purchase another 50, also worth more than USD$10 billion. Officials met in San Francisco to sign the deal on Wednesday.
"Effectively, there are 65 orders out there in the books straight away and you get the ability to buy another 50 at the prices we have negotiated," Gregg said. "We will want those 50, I am pretty sure of that."
He said Qantas had negotiated a discount from Boeing's list price, but declined to give specific numbers.
Qantas decided on the Boeing jets after also considering the A350 made by Airbus.
"For a start, the Boeing plane was far more advanced in its development," Gregg said in explaining the decision. "And the lighter weight gave it a greater range and lower fuel consumption, and that's very important for Qantas, where we are based in the world."
"In fact, from the time we started the negotiations to the time we completed the negotiations... Boeing was able to alter the aircraft so that it had approximately about a 2,500 km additional range."
Qantas expects to take delivery of its first 787-8 in August 2008 for its Jetstar budget carrier. In 2010, it is slated to receive the slightly larger 787-9. Gregg said the airline would use the 787-9s to fly routes including from Melbourne to Los Angeles and eventually to San Francisco.
Qantas is still evaluating which engines should power the 787: Rolls Royce or General Electric... "Both manufacturers are making tweaks to the engines to tell us what they can do," Gregg said.
Engines usually represent more than a fifth of the total aircraft price.
Gregg, who also oversees strategy at Qantas, said the airline was hoping to decide soon on ultra-long range jets.
"We're also calling tenders at the moment for ultra-long range aircraft, that is an aircraft like the 777-200 long-range LR," he said. "I would hope that we would be in a position to make a decision on that in the next three to four months."
