Australian Qantas orders up to 115 new Boeing 787 passenger jets

SYDNEY, Australia -- Australia's flagship carrier Qantas said Wednesday it was ordering up to 115 new Boeing Co. 787 passenger jets in a deal that may net Boeing almost $15 billion, landing a heavy blow in its battle with rival Airbus.

"This is a very, very big commitment by Qantas to growth," Qantas Airways Ltd. chief executive Geoff Dixon said, noting that Qantas had negotiated "an extremely competitive contract" with Boeing.

Chicago-based Boeing Co. said it was finalizing an agreement for 45 planes, with options for 20 more, plus purchase rights for an additional 50. Qantas will start taking delivery of the 787s in 2008.

Boeing's list price for the 787 is $130 million, making 45 planes worth $5.85 billion.

"Our relationship with Qantas dates to the very start of the jet age, and we're thrilled to see that relationship continue with the 787," Alan R. Mulally, president and chief executive of Boeing Commercial Airplanes, said in a statement released when the order was announced Wednesday.

The deal means that Boeing pulls far ahead in its quest this year to sell more aircraft than its archrival Airbus, which also had been lobbying Qantas to buy its planes. As of the end of November, Boeing had won 800 orders -- not including the Qantas order -- more than any year in almost two decades, and more than the previous three years combined. Airbus sold 687 planes during the same period -- up from 370 in 2004.

Airbus spokesman David Voskuhl expressed disappointment with the Qantas decision to buy the 787 but said the "flagship of their fleet" would be the A380.

Qantas is one of 16 airlines that have ordered Airbus' newest plane, the A380 superjumbo, which will become the world's largest passenger jet when it enters service next year. Earlier this year, Airbus angered Qantas and other customers when it announced some A380 deliveries would be delayed.

"We respect the airline's decision," Voskuhl said of Qantas' 787 order. "We would certainly have liked to win, but they have decided in favor of the 787 and we would certainly not criticize that."

The Airbus A350, a planned long-range competitor to the 787, is set to enter service in 2010, two years after the Boeing plane. Neither Qantas nor the rival aircraft makers indicated whether delivery schedules were an important factor in the decision.

Boeing shares rose 86 cents to 71.45 Wednesday on the New York Stock Exchange, topping an all-time record of $70.94 set the day before. Investors sent Qantas stock soaring 3.2 percent to close at $2.91.

The announcement signals that Qantas will not begin flying nonstop between Sydney and destinations like London. The company had talked to both Boeing and Airbus about designing planes capable of making the flight without a refueling stop.

Qantas said it had sought tenders from Airbus and Boeing for ultra-long range variants of the Airbus A340 and Boeing 777 as part of its current fleet renewal plan.

"However, neither the B777 nor the A340 provide an economical solution to our desire to have some of our services overfly midpoint hubs," Dixon said. "We will continue to talk to Airbus and Boeing on further developing the options for longer-range aircraft."

Last week, Qantas announced its domestic budget carrier, Jetstar, would begin international flights by early 2007.

The company said Wednesday some of the newly ordered 787s would go to Jetstar and others to Qantas. Jetstar will fly four A330-200s internationally until it takes delivery of the 787s, officials said.

Dixon said the new carrier later would expand to fly to Europe and other regions around the world.

According to its Web site, Qantas currently operates 201 aircraft, including Boeing 747s, 767s, 737s and 717s, Airbus A330s and A320s, Bombardier Dash 8s and British Aerospace 146s.

The company flew 32.7 million passengers in the year to June 30, including 9.4 million on international routes.