Monday, October 12, 2015

Possible resolution on Ex-Im bank can free Kenya 787 for delivery

The Ex-IM bank reauthorization fiasco might now have a resolution coming in the next few weeks.  The expiration of the bank’s charter has put a crimp in deliveries of some Boeing jets to customers, notably two 787s to Kenya Airways.  Those two airplanes are in storage at Everett.  It was rumored that the carrier was working to find alternative delivery financing but I think it’s safe to say that it probably hasn’t happened.

Last week, a bi-partisan group of Congressmen were able to use what is called a discharge petition in order to get the legislation out of House Financial Services Committee that is led by a Republican who doesn’t want to see the Ex-Em Bank’s charter renewed.  I gathering 218 signatures for the discharge petition, the bipartisan group now has forced a vote that will be taken within the next three weeks.  Still the reauthorization also needs to get past the Senate so I don’t think Boeing will be removing the covers of those two 787s for Kenya just yet.

In other 787 news, Air France, which has been in deep financial turmoil, is talking about canceling part of their 787 order quite possibly the early deliveries which are expected to start late next year.  Indeed, L/N 500, a 787-9 that is being leased to Air France from AerCap is on the firing order.  Air France/KLM ordered a total of 25 787s and have a leasing agreement from AerCap for a further 12 aircraft.  Air France is to get 13 787 from Boeing with another 3 from AerCap.  The remainder are to go to KLM which, it seems, is unaffected by troubles at the parent company. The management group recently converted 6 787-9 of their 25 aircraft order to 6 787-10 though it’s not clear to which carrier the -10s will be delivered.  Given that the first 787-9 for Air France is a year from delivery it stands to reason that some of the long lead items for that aircraft and other near term 787 deliveries are already on production.  It may cost Air France more than it’s worth to cancel the order but the jury is out on that.  Interestingly, the A350-900 order remains intact, perhaps some home country favoritism playing out in this drama?  We may see Boeing sales people chasing Air France management down the street trying to rip their clothes off if the carrier goes ahead with any cancellation.

Oman Air took delivery of the first of 6 787-8 that it had ordered.  The carrier is expected to take delivery of one more this year but it seems that they won’t receive any more next year.

This week, ZD002 for Air Austral should be pulled outside of the EMC as it starts to finish up re-work and change incorporation ahead of its delivery.  It will spend about two and half weeks at the EMC before being towed to the flightline.  ZD001 (L/N 15) will takes its place inside the EMC after ZD002 is pulled outside.  Strangely, ZD006 (L/N 14) will be taken back from the EMC to the storage runway at the end of this month.

Lastly,  there are a number of number of C-1 flights coming up (about 9) over the next two weeks and I do think Boeing should be able to deliver at least 8 more 787s this month possibly 10 more depending on the Ex-Im reauthorization situation.  Boeing has already delivered 2 aircraft this month.


Piotrek_ said...

LN14 will enter storage prior delivery in July 2017. Re-work is (probably) complete, it just need engines and interior furnishing. LN12 will be delivered to Ethiopian earlier, so Boeing is just simply doing this as part of EMC scheduling - it's much too early for interior fit of LN14 and LN12 re-work is undergoing, probably till May 2016. The same situation as with many recent built 787s with zodiac seats delay issue - they are pushing these "under work" first and then finishing earlier built frames which has been in storage.

Ztev Konrad said...

The EXIm bank is dead in its current format. if they can force out a speaker, killing off any resurrection here is just a bump in the kerb. Switched on people can see the financial avalanche coming for ExIm if the boom in aircraft sales get derailed. All those planes on order that rely on a 5 year refresh of existing planes is going to leave a lot of hardware not wanted and not being paid for and dumped in EXIms lap.

Anonymous said...

The 6 787-10 ordered by AFKLM will go to KLM according their latest fleetlist.

Delivery 2021-2022

Ziggy said...

It's not the Speaker of the House that is holding up the re-authorization.

The Chairman of the House Committee that overseas the Bank is the one to blame. He will not let it reach the floor for a vote. There is a procedure under way that can bypass this idiot thru a petition process and there are enough members signed up to bring it to the floor for a vote.

Speaker John Boehner will not stop it since he is in favor of it.

1coolguy1 said...

The reason for this anti-ExIm vote is the issue Delta's CEO and other US airline CEO's have raised: Why does the US finance our competitors at terms we cannot get? It is damaging our business as US carriers.
They make a good case: Why advantage foreign competitors over US carriers?
Ex-Im does not need to go away: It needs to be changed so that cases like this are on a level playing field.