7E7 in 2009
Dec 29, 2004 | 4:30 pm
#1
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7E7 in 2009
http://www.continental.com/vendors/d...A6&s=&i=PRNews
A US major has joined the fold.
Print Version
Continental Airlines to Become First Major U.S. Airline to Order the Boeing 7E7
Also Announces Plans to Lease Additional Boeing 757-300s Starting in 2005 and
Accelerates Deliveries of 737-800s Into 2006
A US major has joined the fold.
Print Version
Continental Airlines to Become First Major U.S. Airline to Order the Boeing 7E7
Also Announces Plans to Lease Additional Boeing 757-300s Starting in 2005 and
Accelerates Deliveries of 737-800s Into 2006
Dec 29, 2004 | 5:13 pm
#2
Join Date: Nov 2002
Location: NYC
Posts: 927
http://www.forbes.com/business/energ...ap1732349.html
Associated Press
Continental Airlines Orders 10 Boeing 7E7s
12.29.2004, 06:46 PM
Continental Airlines Inc. on Wednesday said it agreed to become the first major U.S. airline to order Boeing Co.'s 7E7 aircraft, placing an initial order for 10 planes with the first to be delivered in 2009.
The world's sixth-largest airline said it also agreed to lease eight Boeing 757-300 aircraft to be delivered beginning in July 2005, and to accelerate the delivery of six Boeing 737-800 aircraft into 2006. The planes had been previously scheduled for delivery in 2008.
The company said Boeing agreed to provide backstop lease financing for the 737 aircraft. Additional terms of the agreement were not disclosed in a press release.
"The 7E7 is the widebody of the future for Continental and will provide the platform for our long-term international growth," said Continental president and chief operating officer Larry Kellner in a statement. "Leasing these additional 757 and 737 aircraft will be another step in outdistancing our competitors in this rapidly changing environment."
Continental said the agreements need board approval by Feb. 28, and the 7E7 agreement requires negotiations for an engine supply arrangement. The airline said it expects to finalize its $500 million in annual wage and benefit cost reductions by the deadline.
Shares of Continental closed down 7 cents, or less than 1 percent at $13.45, while Boeing shares finished down $1.18, or 2.2 percent at $52.07 on the New York Stock Exchange.
Associated Press
Continental Airlines Orders 10 Boeing 7E7s
12.29.2004, 06:46 PM
Continental Airlines Inc. on Wednesday said it agreed to become the first major U.S. airline to order Boeing Co.'s 7E7 aircraft, placing an initial order for 10 planes with the first to be delivered in 2009.
The world's sixth-largest airline said it also agreed to lease eight Boeing 757-300 aircraft to be delivered beginning in July 2005, and to accelerate the delivery of six Boeing 737-800 aircraft into 2006. The planes had been previously scheduled for delivery in 2008.
The company said Boeing agreed to provide backstop lease financing for the 737 aircraft. Additional terms of the agreement were not disclosed in a press release.
"The 7E7 is the widebody of the future for Continental and will provide the platform for our long-term international growth," said Continental president and chief operating officer Larry Kellner in a statement. "Leasing these additional 757 and 737 aircraft will be another step in outdistancing our competitors in this rapidly changing environment."
Continental said the agreements need board approval by Feb. 28, and the 7E7 agreement requires negotiations for an engine supply arrangement. The airline said it expects to finalize its $500 million in annual wage and benefit cost reductions by the deadline.
Shares of Continental closed down 7 cents, or less than 1 percent at $13.45, while Boeing shares finished down $1.18, or 2.2 percent at $52.07 on the New York Stock Exchange.
Dec 29, 2004 | 5:57 pm
#3
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There's 8 more of the dreaded 753.
Dec 29, 2004 | 6:05 pm
#4
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Great that CO's not getting the 7E7s... Now to speculate which routes they'd be used on (I'm guessing EWR-HKG?) and how spacious they'll be on the inside.
aloha
aloha
Dec 29, 2004 | 6:54 pm
#5
Join Date: May 2004
Posts: 1,955
I thought the 757 line was closed. Where will they come from?
Dec 29, 2004 | 6:57 pm
#6
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Originally Posted by otralot
I thought the 757 line was closed. Where will they come from?
Pity I'll never fly on them..................been there, done that.
Dec 29, 2004 | 7:00 pm
#7
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Any chance of better AUS coverage?
With 7E7s on the way can we hope that there is better service to Australia in store? - Perhaps even an IAH/LAX - SYD flight ^
Dec 29, 2004 | 7:08 pm
#8
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Originally Posted by otralot
I thought the 757 line was closed. Where will they come from?
I'm interested to see what FC configuration the new 737-800's are in (mid-cabin lav with an extra row of F?) and also what the J:Y ratio will be on the 7E7. I'm assuming that with the 7E7 being a widebody CO will put J seats in? The cabin layouts of these planes will be very telling of the future at CO and the true value of elite status.
Dec 29, 2004 | 7:16 pm
#9
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Originally Posted by TVCMH
...and also what the J:Y ratio will be on the 7E7. I'm assuming that with the 7E7 being a widebody CO will put J seats in? The cabin layouts of these planes will be very telling of the future at CO and the true value of elite status.
Dec 29, 2004 | 7:22 pm
#10
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PVG, PKG, BOM
Last edited by lensman; Dec 29, 2004 at 7:24 pm
Dec 29, 2004 | 7:25 pm
#11
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I guess we now know how they're going to service all those new European routes that they will be starting up this summer...
Dec 29, 2004 | 7:33 pm
#12
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So CO seems set up for long term international growth with the 7E7's in 2008. What are they going to do until then? Aren't they just about maxed out in their usage of their internationally configured fleet? If they really do want to expand internationally before 2008, where are they going to get the planes?
Dec 29, 2004 | 7:52 pm
#13
Join Date: May 2004
Posts: 1,955
Picked this up off airliners.net. Answers a great deal of questions such as CO's use of the 757-300 on domestic routes...
Here is the excerpt from the employee Q&A that also went out via e-mail in conjunction with the press release:
AIRCRAFT ORDER Q AND A
Dec. 29, 2005
Why are we leasing additional aircraft at the same time we are asking for $500 million in annual wage and benefit reductions?
We need to act now to take market share from our weaker competitors. The 757s have become available from Boeing because of the current bankruptcy of ATA, a lowcost competitor. The 737s have become available because American Airlines recently deferred delivery of them due to their financial challenges. Even after lengthy negotiations with Boeing, we were able to keep this opportunity available to us only until Feb. 28, 2005, as Boeing will not hold these aircraft off the market indefinitely. If we dont take these aircraft by then, someone else will most likely a low-cost carrier.
We need to obtain board approval by Feb. 28, 2005, and with your help in making the business case, we can obtain these aircraft. They will help us avoid losing domestic market share to low-cost carriers as we shift our domestic 757-200 aircraft to grow our profitable international network. We dont want to be forced down the path of our failing competitors, who are shrinking and ceding market share and jobs to low-cost carriers.
The Boeing agreement represents our belief in you and in the airlines future.
While it is important to act quickly to survive the current industry downturn, we must plan and prepare for the future. We need to grow (we are currently only the fifth largest U.S. airline) and become stronger to compete in the future. Should consolidation occur, we need to be in a position of strength. Adding international growth helps return us to profitability sooner and cements our position in the marketplace.
In the last seven years, low-cost carriers have significantly increased their market share, while legacy carriers (excluding CO) have shrunk by an average of 10 percent. However, CO has increased its mainline capacity by 25 percent over the same period. Our fleet utilization is already stretched, so to continue this growth, we need additional aircraft. Prior to todays announcement, our plans included only five replacement aircraft over the next three years, offering no prospect for any incremental growth.
By flying these 757 and 737 aircraft on high-density domestic flights, we can free up existing domestic aircraft to expand internationally. In addition, the long-range 7E7 represents the platform for further international growth in years to come.
Before we can justify and get approval from our board of directors for a growth
strategy, we must first achieve a cost structure, with your help, which allows us to stop bleeding cash.
Is my pay being cut in order to fund the new aircraft?
No. The 757 and 737 aircraft are all being leased with no cash upfront. The 7E7 will not be coming for another four years. CO needs $500 million in wage and benefit reductions in order to avoid a cash crisis and to remain competitive in the permanently restructured, low-fare pricing environment. The wage reductions will help CO maintain a competitive cost structure
that allows us to grow and once again achieve profitability.
If youre not using my pay cut, where is the money coming from that will fund these aircraft?
Boeing continues to be a great business partner of CO. Because of our strong
relationship, CO can lease the additional 757 and 737 aircraft with no cash upfront. This means we dont have to spend any money to get the aircraft. In addition, Boeing has also agreed to finance the 757 conversion costs, such as repainting the exteriors and reconfiguring the interiors to COs standards.
The first 7E7 delivery is four years away. Although Boeing has announced the list price of the 10 7E7s as $1.3 billion, CO will receive a significant discount as a preferred launch customer. We believe that with a competitive cost structure we will be able to finance these aircraft on attractive terms when deliveries start in 2009.
Here is the excerpt from the employee Q&A that also went out via e-mail in conjunction with the press release:
AIRCRAFT ORDER Q AND A
Dec. 29, 2005
Why are we leasing additional aircraft at the same time we are asking for $500 million in annual wage and benefit reductions?
We need to act now to take market share from our weaker competitors. The 757s have become available from Boeing because of the current bankruptcy of ATA, a lowcost competitor. The 737s have become available because American Airlines recently deferred delivery of them due to their financial challenges. Even after lengthy negotiations with Boeing, we were able to keep this opportunity available to us only until Feb. 28, 2005, as Boeing will not hold these aircraft off the market indefinitely. If we dont take these aircraft by then, someone else will most likely a low-cost carrier.
We need to obtain board approval by Feb. 28, 2005, and with your help in making the business case, we can obtain these aircraft. They will help us avoid losing domestic market share to low-cost carriers as we shift our domestic 757-200 aircraft to grow our profitable international network. We dont want to be forced down the path of our failing competitors, who are shrinking and ceding market share and jobs to low-cost carriers.
The Boeing agreement represents our belief in you and in the airlines future.
While it is important to act quickly to survive the current industry downturn, we must plan and prepare for the future. We need to grow (we are currently only the fifth largest U.S. airline) and become stronger to compete in the future. Should consolidation occur, we need to be in a position of strength. Adding international growth helps return us to profitability sooner and cements our position in the marketplace.
In the last seven years, low-cost carriers have significantly increased their market share, while legacy carriers (excluding CO) have shrunk by an average of 10 percent. However, CO has increased its mainline capacity by 25 percent over the same period. Our fleet utilization is already stretched, so to continue this growth, we need additional aircraft. Prior to todays announcement, our plans included only five replacement aircraft over the next three years, offering no prospect for any incremental growth.
By flying these 757 and 737 aircraft on high-density domestic flights, we can free up existing domestic aircraft to expand internationally. In addition, the long-range 7E7 represents the platform for further international growth in years to come.
Before we can justify and get approval from our board of directors for a growth
strategy, we must first achieve a cost structure, with your help, which allows us to stop bleeding cash.
Is my pay being cut in order to fund the new aircraft?
No. The 757 and 737 aircraft are all being leased with no cash upfront. The 7E7 will not be coming for another four years. CO needs $500 million in wage and benefit reductions in order to avoid a cash crisis and to remain competitive in the permanently restructured, low-fare pricing environment. The wage reductions will help CO maintain a competitive cost structure
that allows us to grow and once again achieve profitability.
If youre not using my pay cut, where is the money coming from that will fund these aircraft?
Boeing continues to be a great business partner of CO. Because of our strong
relationship, CO can lease the additional 757 and 737 aircraft with no cash upfront. This means we dont have to spend any money to get the aircraft. In addition, Boeing has also agreed to finance the 757 conversion costs, such as repainting the exteriors and reconfiguring the interiors to COs standards.
The first 7E7 delivery is four years away. Although Boeing has announced the list price of the 10 7E7s as $1.3 billion, CO will receive a significant discount as a preferred launch customer. We believe that with a competitive cost structure we will be able to finance these aircraft on attractive terms when deliveries start in 2009.
Dec 29, 2004 | 7:58 pm
#14
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The 753's are indeed coming from ATA. Currently, ATA flies them in all "Y" configuration. Let's hope CO doesn't decide to just keep them that way!
Dec 29, 2004 | 7:59 pm
#15
Join Date: Jul 2003
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Originally Posted by otralot
By flying these 757 and 737 aircraft on high-density domestic flights, we can free up existing domestic aircraft to expand internationally. In addition, the long-range 7E7 represents the platform for further international growth in years to come.