Qantas cancels Boeing orders

QANTAS    BOEING    JETSTAR

Australia - Qantas and Boeing have reached a mutual agreement to defer and cancel up to 30 Boeing airplanes due to continued weak demand in the aviation industry.

The airline will defer delivery of 15 B787-8 aircraft by four years and cancel orders for 15 B787-9s, initially scheduled for delivery between 2014 and 2015.

Alan Joyce, CEO of Qantas said changes to the orders made were appropriate in the current climate and the decision had not been influenced by an earlier announcement by the airplane manufacturer to further delay the B787's inaugural flight.

"Qantas announced its original B787 order in December 2005 and the operating environment for the world's airlines has clearly changed dramatically since then...The agreement we have reached with Boeing will provide greater certainty going forward in terms of our fleet renewal and growth strategies as well as broader resource planning and matching capacity with demand," Joyce said.

The agreed changes between the two parties will see Qantas' initial order reduced from 65 to 50 aircraft, comprising 35 B787-9s and 15 B787-8s. Qantas' first aircraft delivery of 15 B787-9s for Jetstar's international operations scheduled to arrive in the middle of 2013 would now be delayed by three years.

Additionally, Qantas have made plans for 15 B787-8s to follow over the 12 months from the fourth quarter of 2014 for its Australian domestic operations and to retire the remaining Qantas B767-300 fleet. The remaining deliveries of 20 B787-9s for both Qantas and Jetstar international operations will take place from the fourth quarter of 2015 through to 2017, the airline said.

The cancellation of 15 B787-9s is expected to reduce the group's aircraft capital expenditure by US$3 billion, Joyce said.

"Delaying delivery and reducing overall B787 capacity, is prudent, while still enabling Qantas and Jetstar to take advantage of growth opportunities and market demands, both domestically and internationally," said Joyce. 

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