It was quite the crowd that turned out earlier this week at The White House for a signing ceremony between Qatar Airways and General Electric.
A USD$5 billion deal was signed off on by Qatar Airways’ CEO Akbar Al Baker and General Electric’s Chief Executive Officer, David Joyce. Also in attendance were Qatar’s Emir, Sheikh Tamim Bin Hamad Al-Thani, and US President Donald Trump.
Qatar Airways has substantial orders with both Boeing and Airbus as it looks to replace its A380 fleet and expand its global footprint. Many of the new aircraft are to be powered by General Electric’s GEnx and GE9X engines. The finalization of the deal this week in Washington sets up General Electric to maintain, repair and overhaul the engines after the aircraft begin to be delivered from 2024.
Why this is an interesting deal
The appearance of President Trump at the signing ceremony is interesting in itself. It’s a big boost for General Electric and heavy manufacturing in the United States, something President Trump is keen to be seen as a champion of. The deal is a clear win for General Electric’s 27,000 direct and indirect employees.
It could also appear to signal a ramping up of the relationship between Qatar and the United States. Saudi Arabia is the United States’ longstanding key ally in the Gulf and has had a big role in the ongoing economic boycott of Qatar over alleged ties with Iran.
While the Emir and his government are no doubt chuffed at being in the White House, there may be some less than impressed Saudi officials. But as almost everybody recognizes, trade and money have little respect for diplomatic niceties.
Bloomberg is reporting that Qatar is looking to increase its investments in the United States to USD$45 billion over the next two years.
Qatar signs off on two deals with General Electric
Airways Magazine reports that General Electric signed two deals this week in Washington.
The first deal between Qatar and General Electric will see the US manufacturing powerhouse maintain, repair and overhaul the GEnx engines. These will be powering 30 new Boeing 787-9 aircraft Qatar Airways has on order.
Airways Magazine reported General Electric’s CEO, David Joyce, saying;
“Yesterday’s signing will increase Qatar’s GEnx-powered 787 fleet to 60 aircraft and ensure the airlines’ GEnx and GE9X engines receive the highest level of maintenance and support.”
The GEnx has been a big success for General Electric, having sold some 2.500 units over the last 15 years.
In addition to the 787-9 deal, Qatar and General Electric signed off on an agreement concerning the maintenance, repair and overhaul of the GE9X engines that will be used on Qatar’s future Boeing 777 fleet.
Market Screener reports that certification for the GE9X engines is still underway. However, eight airlines have ordered in excess of 700 GE9X engines between them. Certification is expected later in 2019.
Qatar Airways currently flies nearly 60 Boeing 777-200LR and 777-300ER aircraft. It has at least that many 777’s on order again. At this year’s Paris Air Show, Qatar bought another five Boeing 777 freighters. That deal was worth USD$1.8 billion and deliveries will commence in 2025. The factory-fresh freighters will be used to replace retirements from Qatar’s existing 16 Boeing 777 freighters.
Suppliers to Qatar’s 777 agreements, in particular Boeing, will no doubt be pleased to see Qatar Airways’ sometimes mercurial CEO Akbar Al Baker moving forward with this week’s signing in Washington.
Both deals were signed under General Electric’s True Choice Flight Hour Agreements which allows customer airlines to customize their maintenance and supply requirements with General Electric. The engine manufacturer claims this allows airlines to maximize efficiencies and minimize costs.
As Boeing is left reeling from its ongoing 737 MAX issues, it’s good to see a US manufacturer heavily involved in aviation powering ahead.