British Airways (OTC: BAIRY) ordered $8.2 billion worth of new airplanes including 24 Boeing (NYSE: BA) 787 Dreamliners and eight Airbus super-jumbo A380s. As Reuters points out, it ends the airline's exclusive use of the 747 as its large passenger plane. The aircrafts will be delivered between 2010 and 2014.
British Airways said that there was no political pressure to buy from Airbus, which has complained to the WTO that Boeing gets money from the US government to underwrite its development. The claim is that this help comes in the form of military contracts.
So, is this a win or loss for Boeing?
The news is probably bad for the U.S. company. It lost its exclusive 747 franchise with British Airways, one of the world's largest carriers. Although Boeing got a large order for its Dreamliner, the British Airways move gives the Airbus super-jumbo A380 new life. Development of the plane has been repeatedly delayed giving Boeing the chance to market the new stretch version of the 747.
There may never been an answer to the question of whether there's pressure on European airlines to buy from the "local" Airbus. But, the perception will linger that the EU members may be willing to help one of their own.
Douglas A McIntyre is a partner at 24/7 Wall St.
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