American to place order for 100 or more Boeing planes

Date:         20 Nov 96 05:48:28 
From:         kls@ohare.Chicago.COM (Karl Swartz)
Organization: Chicago Software Works, Menlo Park, California
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Today's Wall Street Journal has an article on page A3 (with a pointer
at the top of the Business and Finance column on the front page) that
says American Airlines is expected to announce an order on Thursday
for 100 or more Boeing planes.  The article says the order will
consist of 12 777s, 75 737s, and a small number of 757s and 767s,
with delivery to being in 1998.

Specific models were not mentioned, but the article talks about the
737s as being 150-seat planes and replacements for older aircraft,
specifically, American's 75 727-200s.  That suggests the 737-800,
largest of the upcoming third generation.  (First delivery of this
version will be in early 1998, to launch customer Hapag-Lloyd.)

The article describes the 777 as a 359-passenger plane and talks about
it as a replacement for the MD-11 on international routes, and also an
economical way to open new routes to Asia.  Boeing's WWW page lists
the 777-300 as seating 368-394 pax in a three-class configuration,
with the -200 seating 305 in three-class and 375 in two-class configs.
Based on those seat counts, it's hard to figure which one American
might be ordering, but since AA seemed to think even the -200 was too
big for their needs, the -200 would seem more likely.

Presumably the others will be the 757-200 and 767-300(ER), the same as
AA's recent orders for those types.  AA had been interested in the
757-300 a few years ago, but it seems unlikely that they'd opt for the
new version unless ordering a larger number of planes.

The expected order will be contingent upon ratification of a new, six-
year contract with the pilots.  The 777 and 737 orders will include a
"unique structure for 'aircraft purchasing rights' -- an open-ended
right to purchase jets at an agreed-upon price" instead of traditional
orders and options, according to the WSJ.  "The structure lays out a
firm pricing table to American, but doesn't tie future orders to
specific dates."  The article interprets this as an indication that
AA has decided that their 260 MD-80s will eventually be replaced with

Karl Swartz	|Home
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