Qantas cancels 15 787s, defers delivery on 15 more

Qantas Friday became the latest customer to cancel and/or postpone orders for the Dreamliner, reaching an agreement with Boeing to drop orders for 15 787-9s scheduled for delivery in 2014-15, reducing its order book for the aircraft to 50, and also deferring 15 787-8s by four years.

QF will not get its first 787 until 2013. Originally it was due to receive one per month for 65 months beginning in August 2008. The manufacturer's continuing troubles on the 787 program mean that all customers will receive the aircraft between two and four years late (ATWOnline, June 24).

The largest airline customer for the 787, QF said the cancellation is in response to the steep downturn in airline traffic, with CEO Alan Joyce emphasizing that the decision was not linked to ongoing problems with the Dreamliner, including a sixth delay in the aircraft's first flight announced by Boeing last week (ATWOnline, June 24). "Qantas announced its original 787 order in December 2005 and the operating environment for the world's airlines has clearly changed dramatically since then," Joyce said.

Based on list prices, the cancellation will relieve the airline of $3 billion in capital requirements. The effect will be far-reaching, putting on hold low-cost subsidiary Jetstar's European expansion plans and delaying QF's replacement of its aging 767 fleet. Jetstar now will get the larger, longer-range 787-9 instead of the 787-8, with the latter model replacing 767s in mainline domestic operations.

Boeing now has suffered 72 787 cancellations this year. This is also QF's second aircraft deferral. In April it announced it had postponed deliveries of four A380s and 12 737-800s. It also said it would park 10 aircraft (ATWOnline, April 14).

The downturn has led the airline to forecast a full-year pre-tax profit for its fiscal year ending June 30 of between A$100 million ($80 million) and A$200 million, well below last year's A$1.4 billion pre-tax profit.

Joyce told ATWOnline that while the latest 787 delay is disappointing, QF remains "committed to the aircraft as the right choice for Jetstar's future international expansion, Qantas's growth and as a replacement for Qantas's 767 fleet." QF holds options for 50 additional 787s.