American Airlines pulls the trigger on mega 787 order

American Airlines and Boeing announced a firm 47 strong order for the 787.  The order consists of 22 787-8s which will start arriving in 2020 and 25 787-9s which will be delivered starting in 2023.  These airplanes will be used to replace the 767-300ER, A330-300, and older 777-200ER thus simplifying American's widebody fleet.  The order includes another 28 options for the 787.

American Airlines will cancel the order for 22 Airbus A350 that was ordered by US Airways in a pre-merger deal.  American is also deferring deliveries of 40 737MAX airplanes that were to be delivered between 2020 and 2022.

While this is a firm order what is unclear is if this is an exercise of 58 787 options that American Airlines held as part of their original order.  Boeing will only confirm that the new order is firm and booked.  If the two orders were taken as separate then it would mean that American Airlines order (firm + options) 175 787s which doesn't seem realistic even for an airline as large as American.  A more reasonable conclusion is that the new order is a partial exercise of the 58 options plus adding more options for future replacement and growth.

Currently American's widebody fleet (not including the 787) is made up of the following:

A330-200 - 15
A330-300 - 9
767-300ER - 23
777-200ER - 47
777-300ER - 20

Excluding the 77-300ER which are young and should be in their fleet for years to come, the total near term widebody replacements that American will need is 94 airplanes (encompassing all the A330, 767 and 777-200).  By my reasoning, American has orders for 93 787s - 47 firm new order, 7 firm current order, 39 options (11 current order options + 28 new order options).  This will be enough to simply their widebody fleet to just three types by around 2026 or so the 777-300ER, 787-8 and 787-9.  It is possible that American can use the 39 options for the 787-10 (or any future improved model of the 787).

This order is a shot in the arm for the 787-8 whose orders have been lagging as of late as many customers have been opting for the larger 787-9.  In the futrue the 39 options will probably be used for A330-200 replacement (787-9) and 777-200ER replacement (mix of 787-9 and 787-10).

With this booked order, Boeing now has 1366 order for the 787 (440 787-8, 755 787-9 and 171 787-10).

Here's the text of Boeing's Press Release:

Boeing, American Airlines Sign Major Order for 47 787 Dreamliners

World's largest airline to more than double its Dreamliner fleet

Boeing and American Airlines today announced the world's largest airline will more than double its 787 Dreamliner fleet with a new order for 47 of the super-efficient airplane plus 28 options. The 47 787s are valued at more than $12 billion at list prices and makes American Airlines the largest 787 customer in the Western Hemisphere.

American originally ordered 42 787 Dreamliners and has been using the airplanes' tremendous fuel efficiency and superior passenger amenities to open new routes around the world, including Asia Pacific and Europe, and boost its network efficiency. While American still has more airplanes on the way from its initial order, the airline is buying the additional Dreamliners – 22 787-8s and 25 787-9s – to further modernize and expand its fleet.

"We are extremely honored that American Airlines, is deepening its commitment to the 787 Dreamliner. This new order is a powerful endorsement of the 787 family's unique passenger appeal and unmatched ability to help airlines open new routes and grow profitably," said Boeing Commercial Airplanes President and CEO Kevin McAllister.

Built with lightweight composite materials and powered by advanced engines, the Dreamliner family lowers operating costs by more than 20 percent compared to previous airplanes, and nearly 10 percent compared to today's competing jets.

American becomes the latest airline to place a repeat order for the 787 Dreamliner. More than half of the program's 71 customers have done so, which has helped the 787 program achieve more than 1,350 orders to date.

"We are showing again and again that the 787 Dreamliner is the champion in its class. The airplane's tremendous value proposition explains why it has become the fastest selling twin-aisle jet in history," said Ihssane Mounir, senior vice president of Commercial Sales & Marketing for The Boeing Company. "And when we match the Dreamliner with Boeing's suite of services, it is a combination that delivers unbeatable value for our customers."

Boeing's Global Services division provides American Airlines with efficiency tools such as Airplane Health Management and Toolbox, which help the airline improve operational performance and improve dispatch reliability.

The 787-8 Dreamliner can fly 242 passengers up to 7,355 nautical miles (13,620 km) in a typical two-class configuration. The 787-9, a stretch of the 787-8, can fly 290 passengers up to 7,635 nautical miles.

About Boeing and American Airlines' history

The relationship between Boeing and American Airlines spans over 80 years. Some of the key shared milestones include:

• June 1936: American becomes the first to fly the Douglas DC-3 in commercial service
• January 1959: American uses the Boeing 707 to offer the first coast-to-coast jet service
• March 1961: American is the first in-service with the Boeing 720B
• July 1971: The first DC-10 delivery goes to American
• May 2015: American flies its first revenue flight with the Boeing 787 Dreamliner.

Projected 787 Delivery Dates for December; AMR in a position to finalize their 787-9 order?

With many of the 787s that are in pre-delivery having gone through their first (B-1) flights. I am going to take a moment and speculate on delivery dates for these airplanes.  These are my own assumptions assuming that these aircraft will have to fly the minimal number of acceptance flights.  For now I'm assuming that these planes will deliver between 21 and 24 days after each B-1 flight though there are exceptions (as in Air India, Chinese carriers, and LOT).  This also assumes that there aren't any issues that would need to be corrected and re-tested in subsequent test flights prior to delivery.

Here's my projected delivery dates for this month:

ZA289 (LN 55, N45905) United Airlines - 12/12/12 - 12/15/12
ZA462 (LN 62, A7-BCK) Qatar Airways - 12/15/12 - 12/18/12
ZA464 (LN 82, A7-BCC) Qatar Airways - 12/24/12 - 12/27/12
ZA510 (LN 59, JA817A) ANA - 12/26/12 - 12/29/12
ZA512 (LN 83, JA818A) ANA - 12/27/12 - 12/30/12
ZA287 (LN 52, N27903) United Airlines - 12/28/12 - 12/31/12
ZA183 (LN 84, JA829J) JAL - 12/28/12 - 12/31/12

Again this is my own speculation but it's based on previous and recent deliveries of the 787.  These dates are always in flux and can change easily so I trust the reader will not hold me responsible if all the actual delivery dates turn out to be something totally different. 

Lastly, these numbers could change as Boeing can deliver 787s to Air India (2), China Southern (1) and even LOT Polish (1).  Boeing is making a huge effort to try and delivery these aircraft within the next 24 days and the way we can accurately tell is the flight activity of each of these airplanes over the next 2-3 weeks.

Lastly, the pilots union at American Airlines has ratified the new labor agreement with AMR today. This could be significant for 787-9 order that AA intends to finalize with Boeing as the order is dependent on AMR agreeing to a new contract with their pilots.  Now this was all before AMR entered Chapter 11 so the bankruptcy judge and AMR's creditors may have something to say about this order and whether it can proceed.  Additionally, a report emerged this evening that US Airways had submitted a bid for American in November.  What effect an AMR-US Airways merger would have on the MoU for the 42 787-9 American intends to finalize is unclear though US Airways does have an outstanding order for 18 A350-800 and 4 A350-900 by Airbus.  Boeing can deliver the 787-9 to American starting in 2014 (theoretically) which is much earlier than US Airways can get either variant of the A350 that they have ordered.  Also a combined company may be opened to operating a mixed Boeing-Airbus fleet as with Delta/Northwest and United/Continental.  A US Airways/American tie up would retain the American name.