Gulf Air Signs $6B Contract For Dreamliners
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Gulf Air, Bahrain’s loss-making national carrier, and Boeing Co. signed a $6 billion agreement for the delivery of 24 Dreamliner aircraft to begin in 2016, a spokesman for the airline, Adnan Malik, said.
The deal includes a firm order for 16 787-8 planes worth $3.4 billion and options for another eight, Mr. Malik said by phone from Bahrain. The carrier is also considering alternatives from Boeing, the world’s second-largest commercial plane maker, and Airbus SAS to fly short-haul routes, and could order a total of 45 new planes including yesterday’s order, he said. The Dreamliner is Boeing’s most successful new airplane program in terms of sales with more than 800 orders valued at more than $120 billion. It ranked second in commercial orders last year behind the 737 narrow-body model. Persian Gulf carriers including Dubai’s Emirates, Abu Dhabi’s Etihad, and Qatar Airways are among the biggest customers for Airbus and Boeing, as the airlines build the region into a hub for tourism and transit flights between Europe, Asia, and Africa. Middle Eastern carriers posted orders and options worth about $85 billion with Airbus and Boeing at the Dubai AirShow in a bid to meet surging travel demands. The agreement was signed on the eve of a visit by President Bush to the Persian Gulf island, home of the U.S. Navy’s 5th Fleet.
Gulf Air, which has 30 planes to service 26 destinations, may hold an initial public offering in 2008, the chairman of the company, Mahmood al Kooheji, said at the Dubai Air Show in November. It has reduced losses by 30% recently and is now losing $600,000 a day compared with $1 million earlier. The airline expects to break even in 2009, Mr. Malik said.
In July, the carrier said its chief executive officer, Andre Dose, will resign after less than four months in the job without saying why. Mr. Dose, a former chief executive of Swiss International Air Lines Ltd., took the job about nine months after his predecessor James Hogan left to run Etihad Airways. He had trimmed the airline’s fleet and cut long-haul routes in a bid to stem losses.
