Boeing/Airbus loose 400 aircraft order from Dubai

The two giants had been courting leasing company Dubai Aerospace for a massive $40 billion order for A320/330 and 737 aircraft.

That order is not not going to happen because neither of the manufacturers were prepared to sell at a price DAE was prepared to pay.

The A320 and 737 are sold out until the end of 2024 even if there were no new orders.

If you want more aircraft and sooner then deals have to be done to shift deliveries about with existing orders. That’s actually a lot easier to do than it sounds, as airlines constantly shift delivery dates to match capacity and financing.

However when you’re sold out there’s no pressure to offer discounts on the scale that DAE wanted – allegedly some 55% – when at best the deal might have gotten around 40%.

Neither Airbus or Boeing are desperate for orders and neither was prepared to just give product away. So the deal fell apart.

DAE is now changing tack. It’s target was to own and rent out 800 aircraft by 2025 – it’s own ordered from the manufacturers. It now aims to turn that into reality by buying another leasing company and taking in its ordered aircraft and those already owned.

It might find that harder to do than it thinks. Chinese companies have moved in on leasing companies around the world with subtle share holdings and indirect control, leaving little room for bargain buyouts.

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