Boeing gets needed lift with deal for 50 planes

SEATTLE -- Boeing Co. needed some good news, and it got some yesterday.

The beleaguered aerospace giant officially launched its new 7E7 Dreamliner passenger jet with a 50-plane order from All Nippon Airways -- Boeing's biggest initial order ever for a new model.

The deal would be worth $6 billion at the list price of $120 million a plane, but major airline customers typically negotiate steep discounts. Neither Boeing nor ANA released a price for the order.

Good news has been scarce for Boeing's Seattle-based commercial airplanes division, which has endured a drought of new airplane orders and had to shelve two earlier commercial jet programs for lack of customer interest. Furthermore, European archrival Airbus pulled ahead of Boeing in jetliner deliveries last year for the first time.

"Boeing had really kind of developed an image of 'all hat and no cattle,' to use a Texas term, so this finally is saying, 'Yeah, we're here to make airplanes,' " said aviation consultant Scott Hamilton.

The Chicago-based aerospace giant also has been shaken by scandals in its defense business, which cast a cloud over the company and prompted the resignation of former chief executive Phil Condit.

"This was exactly what they needed -- and then a little more," said Richard Aboulafia, an analyst with the Teal Group.

Aboulafia said the ANA deal will not only help jump-start Boeing's commercial jet business, but may reverse a perception that Boeing was coming to depend on defense contracts rather than aggressively using its own resources to create new technology.

"It sends the message [that] you're not just getting fat off government contracts; you're investing your own money in the future, too," Aboulafia said.

Boeing also is being investigated by the government over a deal to supply 100 airborne tankers, based on the 767 passenger jet, to the US Air Force. The probe has to do with whether Boeing improperly received pricing information about Airbus to win the contract.

In a separate case, Lockheed Martin has filed a lawsuit that accuses Boeing of using proprietary information to win a $1.88 billion Air Force rocket launch contract.

Mike Bair, Boeing's senior vice president for the 7E7 program, called the All Nippon deal a "really, really important thing for the Boeing company."

He said Boeing expects to announce additional 7E7 orders soon and that Chinese carriers are especially interested in the plane to meet growing passenger demands and increased cargo needs. But he also noted that the company has made firm offers to more than a dozen carriers, including "a couple" of US carriers.

The All Nippon order broke Boeing's record for launch orders, set in 1960 when Eastern Airlines and United Airlines each ordered 40 727s.

The 7E7 -- the "E" stands for efficiency -- is the first new airplane Boeing has introduced in more than a decade, since it launched the 777 in October 1990.

Production is to begin in 2006, and the airplane is expected to be in service in 2008.