Qatar Air Eyes New 747 Deal as Embargo Spurs Cargo Demand
Qatar Air Mulls New Boeing 747 Freighter Order as Cargo Booms
(Bloomberg) -- Qatar Airways Ltd. is considering whether to order more Boeing Co. 747 jumbo freighters as global air cargo rebounds and the Persian Gulf carrier responds to a blockade of its home country.
The jets, featuring a hinged nose that flips open to load oversize equipment, would help the Doha-based carrier make good on its ambition to become the largest international cargo operator in the world, Chief Executive Officer Akbar Al Baker told reporters Monday during a visit to Seattle to take delivery of the first of Qatar Air’s two 747-8 freighters.
Boeing has been scrambling to land additional 747 orders to extend the commercial life of its iconic hump-backed jet into the next decade. The Chicago-based planemaker had 20 unfilled jumbo orders as of the end of August, including the two jets now identified as bound for Qatar Air. That’s the equivalent of about three years of production at its current six-jets-a-year pace.
Qatar Air’s cargo division is flourishing as demand rebounds from a lengthy slump, with industry-wide loads up 11 percent this year through July, according to the International Air Transport Association. Qatar ranked as the world’s fourth biggest air-freight carrier last year by tons moved and second only to Dubai-based Emirates excluding specialist operators FedEx Corp. and United Parcel Service Inc., based on IATA data.
The flight embargo imposed in June by neighboring nations to penalize Qatar actually has provided a benefit, Al Baker said. Air-freight deliveries have climbed 160 percent from a year ago as Qatar Air has airlifted in fresh food, medical equipment and other supplies. Four Arab nations severed diplomatic and transport links with Qatar as punishment for allegedly backing Islamic militants, a charge the Gulf nation denies.
Unintended Boon
“I’m pleased to tell you today that in fact the blockade has quite the opposite impact on our business to the one intended,” Al Baker said. “Our adversaries thought they would bring us to our knees and we would capitulate, but this didn’t happen.”
He dismissed any suggestion that Qatar Air might delay aircraft orders because of the blockade or slowing travel growth in the Middle East. “We are not studying any deferrals because Qatar Airways’ aircraft orders are not all growth airplanes,” Al Baker said. “They are also fleet replacement.”
The carrier plans to take all 110 of the Boeing 777X planes that it has committed to buy from Boeing through orders or options. And it expanded a previous order for 44 of Boeing’s 777-300ER by four aircraft, a deal previously recorded on Boeing’s backlog without disclosing the buyer. Combined with the two jumbos, the aircraft are worth $2.16 billion at list prices before the customary discounts.
Qatar Air has decided to take all of the Airbus SE A350 aircraft it has on order, reversing an earlier plan to cancel four deliveries, Al Baker said.
As to Qatar Air’s ongoing war of words with U.S. carriers over access to the world’s biggest aviation market, Al Baker advised its rivals to “shut up and mind their own business.” The Mideast company’s expansion should continue with the closing of a deal to take a 49 percent stake in Italy’s Meridiana as early as this month, he said.
To contact the reporters on this story: Julie Johnsson in Chicago at jjohnsson@bloomberg.net, Alexandria Arnold in Seattle at abaca3@bloomberg.net.
To contact the editors responsible for this story: Brendan Case at bcase4@bloomberg.net, Susan Warren, Christopher Jasper