Thursday, November 3, 2016

Iranian minister says Boeing's huge deal with Iran Air to be finalized within days

(Puget Sound Business Journal)

Boeing and Iran are "within days" of finalizing the details of Iran Air's massive order for 80 aircraft after it was approved by the U.S. government last month.

The details reportedly include moves by Boeing and its rival Airbus, which has its own big deal with Iran, to grant companies In Iran a concession to make aircraft parts inside the Islamic country.
Those details emerged from recent media reports from inside Iran, including the suggestion that Boeing would deliver an unspecified number of aircraft before the end of the Iranian calendar year, which is March 20, 2017.

Iranian Deputy Transport Minister Asghar Fakhrieh-Kashan offered those details in remarks published by The Tehran Times, the country's leading English-language newspaper.

A second report by the Azerbaijan-based Trend News Agency, which operates in Iran, Turkmenistan and Kazakhstan, quoted Fakhrieh-Kashan's boss, Iranian Transport Minister Abbas Akhondi, saying that both Boeing and Airbus were drafting "concessions" so unspecified aircraft parts could be made inside Iran.

Boeing Commercial Airplanes spokesman Paul R. Bergman said Tuesday the jet maker remains in talks with Iran Air, and any final sale "would have to adhere to the license we’ve been issued."

It's unclear if a parts concession is part of Boeing's license because it's not been made public. Bergman did not comment on that issue.

Boeing's blockbuster deal to sell up to 80 passenger jets to Iran includes 30 of its 777 jets and four 747-8 intercontinental aircraft. If it goes ahead, it will offer a much needed boost to Boeing's sluggish wide-body airplane sales — and the Puget Sound plants that manufacture them.

Boeing's export license also allows the Chicago-based manufacturer to sell 40 737 Max airplanes and six 737NG jets, which are all made in Renton. Under its deal with Iran, Boeing also agreed to help lease 29 additional 737s, but it's not clear whether the export license covers that.

Combined, the Iran Air deal totals $25 billion for Boeing at list prices, though larger orders of this magnitude typically enjoy discounts.

Airbus itself signed a deal for 112 to 118 planes earlier this year, but received a U.S. export license to ship only 20 planes to Iran so far, including A320s and A330 models.

Iranian politicians' public statements on the timing of aircraft deals must be viewed with some caution.

In January, Iranian political leaders said planes would start being delivered beginning in March 2016.

The U.S. government didn't actually authorize the export sales until late September, and no planes have been delivered so far.

(Andrew McIntosh - Puget Sound Business Journal)

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