Etihad kicks off order spree with $31 billion Boeing deal

Etihad kicks off order spree with $31 billion Boeing deal
An aerial view taken on May 27, 2012 shows Dubai international airport, home to the national carrier Emirates Airways. The 13th edition of the Dubai Airshow will open on November 16, 2013 with Emirates, Etihad and Qatar Airways -- the new generation of global airline players -- aggressively expanding their fleets making the Show one of the "top tier events in the aviation industry," said Richard Aboulafia, vice president of the Teal Group consultancy.

* Boeing seen launching 777X with around 250 orders, 4 buyers

* Emirates says to order Airbus A380s

* Boeing says union vote on 777X assembly won't deter launch

* Cameron pays lightning visit amid fighter jet contest

DUBAI - Abu Dhabi's Etihad Airways placed a US$25.2 billion (S$31.42 billion) aircraft order with Boeing on Sunday, kicking off a Dubai Airshow expected to be dominated by the formal launch of Boeing's newest airplane and fresh demand for the world's largest passenger jet.

Sheikhs and ruling family members of Dubai and neighbouring Abu Dhabi toured rows of passenger jets and arms pavilions as a sandstorm blotted the skies over a new 645,000 square metre facility, built to showcase the Middle East's largest aviation hub.

Gulf airlines are competing with each other for a share of traffic flooding through the region, due to its strategic location between East and West, and squabbled behind the scenes over the order of announcements for up to 400 new planes expected to be worth over US$100 billion at list prices.

Abu Dhabi's Etihad Airways started the spending spree with an order for 56 Boeing airplanes, including 25 of its new 777X mini jumbos and 30 787 Dreamliners.

But domestic rival Emirates looked set to dominate the event with orders for as many as 150 of the long-haul planes coupled with a repeat order for the Airbus A380 superjumbo. "We will order A380s," Sheikh Ahmed bin Saeed Al Maktoum, chairman of the Dubai-based airline, told Reuters.

He added that the carrier's order value at the show would exceed its order of US$18 billion at the last such event in 2011.

The birth of a revamped successor to Boeing's 777 jet, with some 250 orders from four airlines, marks a new step in the growth of Gulf airlines and a fierce contest between Boeing and Airbus for their business.

Boeing is expected to launch the 777X jet with orders from the top three Gulf carriers - Emirates, Etihad Airways and Qatar Airways - and Germany's Lufthansa which has already tentatively committed to buy 34 of the planes.

A fifth, Hong Kong's Cathay Pacific, could join the programme later, industry experts said, while British Airways has expressed interest in the jet.

Boeing's top planemaking official pledged not to let a dispute with Seattle assembly workers over where the plane should be built interfere with its launch, which is expected to be announced on day one of the Nov. 17-21 show.

Boeing is looking for a home for the new jet after members of the International Association of Machinists rejected a proposed contract that would have seen Boeing commit to keeping the latest member of the 777 series near Seattle in exchange for restructured benefits.

Airbus, which has a record of springing surprises at air shows, is keen to prevent a smooth lift-off for the 777X and is negotiating deals for all sizes of its jets including the A380. "Airbus is desperate to blunt the impact of the 777X," said a senior industry source, speaking on condition of anonymity.

The event presents a personal challenge for combative Airbus sales chief John Leahy, a New Yorker who is keen to avoid a rare defeat at an air show in his 20th year in the job.

Leahy is under pressure to revive the fortunes of the A380, which has so far found no buyers this year and faces a cut in production unless empty 2015 production slots can be filled.

Emirates has frequently said it would add another 30 aircraft to its existing order for 90 superjumbos once it resolves capacity constraints in its hub.

An industry source said Emirates was in talks to order another 20-25 A380s but that this could rise. A second industry source said Emirates could place a record order for as many as 50 jets, in a deal worth over US$20 billion at list prices.

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