Airbus flings trash talk at Boeing's sales pitch
Squeezed into a tiny office in the noisy Boeing media building, Toby Bright, the company's top salesman, was low-key and matter of fact.
He couldn't reveal too much about unannounced possibilities in his 7E7 sales-campaign books. But he was quietly confident.
"There's a good chance we can end up close to the 200 number" for 7E7 orders by year-end, he said, then added disarmingly: "I have made a commitment to Alan [Mulally, Boeing Commercial Airplanes CEO] that's a little bit less than that — what I feel absolutely positive about."
A short walk up the hill from the Farnborough runways to an adjacent street in this temporary city of pre-fab "chalets," Airbus' top salesman, John Leahy, held court in brasher style.
Upstairs in the sumptuous main Airbus chalet — not the media center but the ritzier surroundings where airline executives and suppliers are entertained — Leahy was ending a day of meetings.
Talking in rapid, well-crafted sentences, calmly but firmly, he trashed the 7E7 and all the "hype" Bright has spun around a jet that represents Boeing's only hope for a commercial-airplanes future.
"I can't see where this big demand is supposedly coming from," Leahy said. "It may be more in the category of wishful thinking than firm orders."
Boeing has already announced 62 initial orders for the 7E7. That's a very promising start. But no contracts have been signed.
Interest is extremely high from a wide cross-section of airlines, Bright said, even from the troubled U.S. carriers.
"Six months ago, I wouldn't have guessed we'd have the same interest from U.S. carriers," he said.
Carriers that have put down deposits have been awarded temporary slots in the delivery queue.
Of the 92 7E7 deliveries slated for 2008 and 2009, all have been assigned. And 80 percent of the delivery slots for 2010 have been filled.
But some of the 200 orders Bright is counting on are proposals-to-buy based on refundable deposits.
He is patiently negotiating the final contracts, though not with infinite patience.
"At some point, you have to say to a carrier: 'If you want to hold your positions, you have to make your deposit nonrefundable.' "
This squishiness is an easy target for Leahy. He simply doesn't believe the projection of 200 orders.
In constant touch with the same airlines as Bright, Leahy is, of course, keen to sell them A330-200s, the mid-sized Airbus jet that the 7E7 will compete against.
He thinks airline executives would tell him if they were close to signing a 7E7 deal. But none has, he said.
"I can't see where this big demand is supposedly coming from," Leahy said. "It may be more in the category of wishful thinking than firm orders."
Then he ran through some peripheral 7E7 features that Boeing touts: the cool exterior look and interior decor, the high windows, the improved cabin air pressure — and dismissed them all as irrelevant.
The only thing that matters to the airlines, said Leahy, is floor space, cargo space and the cost per passenger per mile. Those parameters, he claims — contradicting Boeing — are the same on the 7E7 as on the A330.
"We're not selling sports cars to middle-aged men in midlife crisis," he said.
"Airlines are really nuts-and-bolts people; they've got to make it work," Leahy added. "The airplanes we are building are the machine tools of the airline industry."
Leahy conceded the 7E7 will have a 1,000-mile-range advantage on the A330.
But since his plane can fly London to Los Angeles, he doubts the 7E7's added range will make much difference.
The 7E7 will sell well enough to win half the market against the A330, Leahy concluded. That's about 1,000 planes in Airbus' forecast, though it would be 750 short of what Boeing hopes for.
While Leahy spent most of his time ridiculing the 7E7's peripheral features, his crucial point was to assert that the jet's operating economics are the same as the A330's.
But Bright's main pitch for the 7E7 is just the opposite, insisting on the jet's supposedly superior fuel efficiency and operating economics.
It's a debate the airline data experts will have to settle.
In the meantime, the question for airline executives is: Would you buy a new plane from one of these men?
Which one?
Huge Airbus order from Mideast carrier
FARNBOROUGH, England — Airbus outmaneuvered Boeing yesterday to land an airplane order worth more than $7 billion, underscoring what both manufacturers and some analysts see as a gradual recovery in the long-suffering aviation market.
The Airbus deal with Abu Dhabi-based Etihad Airways, which includes four super-size Airbus A380 jets, eclipsed Boeing's $2.96 billion sale to Emirates Airline announced Monday.
Etihad also agreed to buy 12 A330-200s, four A340-500s and four A340-600s.
The fledgling carrier has options on an additional 12 aircraft of all types, including A380s.
Airbus is to begin delivering the planes in 2006.
Etihad Chairman Sheik Ahmed bin Saif Al-Nehyan said Etihad had considered buying Boeing's new 7E7 but didn't want to wait until 2008, when the medium-sized plane is due to become available.
"The surprising thing is that these airlines are asking for delivery sooner than Airbus and Boeing might have expected. In airline terms, it's almost 'as soon as possible,' " said Sandy Morris of ABN AMRO Bank in London.
Sales of civilian aircraft plummeted after the Sept. 11 attacks, and conditions worsened with the SARS epidemic in Asia, the bursting of the dot-com bubble and the war in Iraq.
After three years of stagnation, Airbus and Boeing are cautiously predicting a rebound.
Boeing foresees a $5.4 trillion market for new commercial planes and aviation services during the next two decades.
It expects the world's airline fleet to double by 2023 and forecasts a 5.2 percent annual increase in global air travel, the company said in its market outlook, released yesterday.
The Associated Press