United to Buy Boeing, Airbus Jets: Exclusive | Aerospace/Defense | Financial Articles & Investing News | TheStreet.com


CHICAGO (TheStreet) -- United(UAUA Quote) is expected to announce Tuesday that it will order new widebody aircraft from both Boeing and Airbus, TheStreet.com has learned.

The order will be for both Boeing 787s and Airbus A350s, according to people familiar with the order, and would represent a major boost for each of the two manufacturers, since significant delays have hampered each aircraft's development. Spokesmen for Airbus, Boeing and United declined to comment.

The Boeing 787 "Dreamliner" is more than two years behind schedule, although Boeing has said the first one will fly by the end of 2009. Airbus, meanwhile, is expected to start to build the first A350 early next year.
United would become the last of the major U.S. airlines to place an order for one of the new airplanes. US Airways(LCC Quote) and Hawaiian Airlines(HA Quote) have ordered A350s, while American(AMR Quote), Continental(CAL Quote) and Delta(DAL Quote) have ordered the 787.

 

Considering United's historical tie to Boeing and the role United played in the 777, I don't see how this can be seen as anything other than a loss for Boeing. Couple this with United's recent retirement of the 737 fleet and you see this is quite a change for the former members of United Aircraft and Transport Corporation from the days of the 777.

 

Just in time for the retirement of the 747-400s. Don't expect to see growth from UAUA in the next 20 years, other than the cancerous growth that comes from a merger.

 

Don't forget the cancerous growth at the regionals. Park the 737's, more flying for GoJet. No orders or serious talk about a 100 seat replacement.

 

I think we all would like to know how to "predict" the future of the next 20 years like you have become able to......you are all knowing.....RIGHT!!!!

Go Away.

 

Granted... I don't know much about these two new aircraft, but this order doesn't seem to make much sense to me. Aren't both of these aircraft designed with the same basic segment, 200-300 seats, in mind? Why would an airline want two different makes of aircraft, with all the associated differences in maintenance, spares, etc., that basically fit the same market niche? Someone in the know please enlighten me...

 

It is great!

Buy jets when you are getting horrible rates on existing collateral.

 

It is just the same old dumb United management. Why operate one type of aircraft when you can operate two. In 1999 they had 10 fleet types operating and about 10-15% of the pilots involved in training at any one time.

Fleets Operating in 1999
727
737-200
737-300 and 500
A320
757
767-200 and 300
DC10
777
747-200
747-400

 

They'll never take delivery of these planes. They can't pay for them.

I'd be willing to bet that they are more likely financed at greater than 100%. United needs cash now badly and the manufacturers need orders. Say United orders $10B worth of jets financed at 110% (or some other similar arrangement), they just got a $1B cash infusion and Boeing/Airbus just got to put $10B worth of orders on the books.

It seems great now but it'll all come to a horrible end when United doesn't survive or can't pay up.

 

Kind of the hat trick I was thinking about. Only flaw is that they do not get to finance these jets and take the cash until the asset is in their possession.
The can set it up, pay their deposits, but the financing does become effective until their is a asset to finance.....