Qatar Airways Seeks Compensation From Boeing for 787 Delay

Qatar Airways, which has 60 Boeing Co. 787 Dreamliners on order, is seeking compensation from the U.S.based planemaker for the delay in the delivery of the aircraft that has hit the carrier’s aggressive expansion plans, a senior company official said Sunday.

“It’s standard that we have a compensation clause in all of our agreements,” Ali Al Rais, Qatar Airway’s executive vice president said at a press conference for the launch of the carrier’s nonstop service to Houston from March 30. “Boeing already know that they are at fault and they know the clause will kick in.”

Al Rais refused to comment on the amount of compensation the Doha-based airline is seeking, but said the delay has impacted its ambitious expansion plans.

“We have adjusted our expansion plan accordingly, and fortunately we’ve not completely banked on 787s. We’ve got Airbus orders too,” he said.

Qatar Airways currently has a firm order for 30 787 aircraft with an option for a further 30. It was due to receive the first of its 787s at the end of 2010.

Al Rais said the airline hasn’t received a new delivery date for the aircraft order.

Last month, Boeing pushed back the roll-out dates for its new 787 for the fourth time, due to a machinists’ strike and the need to replace fasteners in some of the airplanes. The company delayed the commercial jet’s first flight until the second quarter of this year, and said customers holding orders for almost 900 of the planes won’t see the first deliveries until the first quarter of 2010 – almost two years later than planned.

The company, which vies with Europe’s Airbus for plane orders, said it will cut about 4,500 jobs at its commercial airplanes business this year amid falling sales. Orders fell 50% in 2008.

Qatar Airways joins other airlines including Air New Zealand, Air India, Japan’s Nippon Airways and Japan Airlines seeking redress after Boeing announced in April a further six-month delay for its new 787 Dreamliner plane.

More than 50 airlines are waiting for 892 Boeing 787s, worth a combined $145 billion at list prices. A total of 93 orders were made for the jet in 2008. Other Middle East buyers of the 787 include Kuwait Aviation Lease and Finance Co. and state-owned Dubai Aerospace Enterprise.

Expansion
Al Rais said Qatar Airways will continue to expand despite the 787 delay, and will take delivery of one 777 aircraft every month for the rest of the year and shrugged off concerns over the financing of the new aircraft.

“It is a tough market, but banks are still being very supportive and … are delighted to work with us,” he said. He also shrugged off concerns about how the ongoing financial crisis will impact the state-owned carrier’s business and said it expects its passenger numbers and revenue to grow between 30 and 35% in 2009.

“We’re resilient to what’s happening in the markets. So far we have not been affected and our revenues have been good,” he said.

Al Rais said the airline expects to receive its A380 orders by 2011 to coincide with the opening of a new airport in the gas-rich Gulf state. The airline has ordered five of the superjumbos.

Qatar Airways currently operates a fleet of 65 aircraft and has almost 200 aircraft worth $40 billion on order.

The airline also plans to operate the first commercial flight using natural gas in 2010.
“The project with Shell and our other partners is on track and in the final stages. If anything, this is the time it’s most needed,” he said.

The airline has also been linked to Greece’s struggling national carrier Olympic Airlines. Last month, the Greek government and media said Qatar Airways was considering moves to take a stake in the Greek airline that has a fleet of 41 aircraft, but Al Rais said Qatar hadn’t ever bid for the carrier and isn’t seeking stakes in any other airlines.

“We never bid for Olympic. The offer came our way. We get a lot of offers, but we’re focused on Qatar Airways. I can assure you that we’ve not pitched and will not pitch for any other airline,” said Al Rais.

The Greek government split the loss-making airline into three parts last September and launched a tender to sell them off as part of its privatization plans.