Boeing 787 Delay Affects ANA and Qantas' Budget Airline

SYDNEY, Australia_Australia's Qantas says another delay in delivery of Boeing's new 787 will slow the expansion plans of its budget subsidiary, while All Nippon Airways - in line to get the first plane - said it was "extremely unhappy" about the delay.

U.S. plane manufacturer Boeing Co. ended weeks of speculation Wednesday by announcing the inaugural flight of the 787 will be delayed up to another three months, pushing delivery of the first plane into early 2009 - the third time the plane has been delayed.

ANA, Japan's second-largest airline, which has ordered 50 of the mid-sized, long-haul jets, was originally scheduled to get the first plane midyear and four others before the end of 2008.

The company is reviewing plans, including the training of employees, that had been timed with the first 787 deliveries, said spokesman Kazuyuki Imanishi.

"We are extremely unhappy," he said.

The carrier is still trying to get full details of the delay from Boeing as it just got the news about midnight Wednesday and all it knows is that the delivery won't happen this year and is being delayed into early 2009.

Imanishi said other planes in the ANA fleet will be used for the routes on which the Dreamliners would have been used. No major impact on ANA business plans or earnings is expected so far, he said.

Meanwhile, Qantas' budget subsidiary Jetstar doesn't expect to get its first 787 until May 2009 - delayed from August this year. It was to use the planes to expand its domestic operations internationally.

"In the meantime, we will look at a range of options including revised retirement dates for some of our aircraft, reallocating existing capacity and potential schedule adjustments," said Qantas Chief Executive Geoff Dixon in a statement Thursday.

He said the delay will have no impact on Qantas Group's earnings or the company's overall growth strategy while delaying the international plans of Jetstar "in the short term."

Qantas said it would discuss with Boeing the possibility of claiming damages for the delay, which is provided for in the contracts. Qantas has ordered 65 of the plans, dubbed the Dreamliner, has options on 20 others and purchase rights over 30 more.

Some analysts estimate Boeing faces as much as a few million dollars (euros) in penalty payments for every plane that is delivered late.

It was not immediately clear how many other 787 customers would be affected by the latest delay. Last fall, the company said it was working on revised delivery schedules with about 15 customers. To date, Boeing said 55 airlines have placed 817 orders for the plane.

Japan's biggest airline, Japan Airlines Corp., or JAL, said it is still looking into the detailed delivery schedule with Boeing, according to Dow Jones Newswires. It said it will make efforts to absorb delivery delays by adjusting its fleet.

JAL has 35 orders for the 787 Dreamliners, with an option to buy 20 addition airplanes.