Poland's National Airline To Lease 787's

LOT, the national airline of Poland, has decided that it prefers Boeing 787's over A350's offered by the European company, Airbus. The company will lease seven of the jets, with an option for five more. The airline already operates 19 Boeing jets and a number of smaller aircraft.

European leaders had written letters in support of Airbus, which until this year was eclipsing Boeing in the manufacture of commercial aircraft. Boeing's long lead in commercial jets was lost to Airbus in 2003, but the company has since received hundreds of orders for its 737's and the all-new 787 Dreamliner. Boeing has also received an order from UPS, the package delivery company, for 747-400 freighters.

The good news comes as a machinists' strike continues at Boeing, which has caused at least one Boeing vendor to lay off its workers. The strike is not expected to harm Boeing unless it continues beyond the end of this year.

Boeing has outsourced a number of critical manufacturing requirements to factories in China and Japan. This approach, which is facing regulatory hurdles from a Bush Administration suspicious of technology transfer to the China, helps the company maintain contacts in both countries and makes it technologically attractive for China to buy Boeing. The company intends to maintain its outsourcing of certain parts fabrication for the 787.

To some extent, Airbus is playing a game of catch-up with Boeing in China, where the American company has built up a history of business relationships. LOT's order, however, is in Airbus's backyard, and therefore may represent a significant setback for the European manufacturer's plans for market expansion. For its part, Poland, a strong U.S. political and military ally, has placed its bets on the continuation of its relationship with the United States to the detriment of its ties to the EU, in which it is a new member.

In other Boeing news and comment:

Boeing may be facing a backlog of orders as a result of its recent sales success. Its stock has risen considerably since the depression caused in the airliner industry by 9/11 and other factors. Ironically, the volume of orders the company has received seems to have encouraged the machinists' union to bargain harder than it otherwise would have.

Some may even argue that that unions have been making concessions during bad times for the industry in the past and that this deserves consideration in the present strike.

No further negotations with the machinists' union are currently planned.

Sources consulted include: AP story.