Iran Air Confirms Cancellation of Early Boeing Delivery

EghtesadOnline: Iran Air has confirmed the cancellation of the earlier-than-expected delivery of a Boeing 777-300ER as part of a $17 billion order from the American planemaker.

News ID: ۷۷۵۷۳۷

26 April 2017

The cancellation came after deputy minister of roads and urban development, Asghar Fakhrieh-Kashan, announced this month that Boeing had offered the jet to Iran Air after Turkish Airlines canceled its order ahead of delivery. He said Iran Air was studying the specification of the wide-body jet and that Iran expected a delivery within weeks.

Iran Air CEO Farhad Parvaresh has been quoted by the Ministry of Roads and Urban Development’s news service as saying that his company had welcomed Boeing’s offer and that after performing technical and financial assessment it was close to receiving the plane, “but the plane was not available anymore”.

He did not elaborate as to why the delivery was cancelled, according to Financial Tribune.

After lengthy negotiations following the nuclear deal Iran signed in 2015 with world powers, Boeing secured a contract in December 2016 with Iran Air for the sale of 80 planes—the first such dealing in decades.

The order includes 50 of Boeing’s narrow-body 737max 8s, 15 wide-body 777-300ERs and 15 777-9s, which will be delivered to Iran Air over 10 years.

The canceled delivery would have cut short the long waiting period for Iran Air to receive its first Boeing jet.

Before the Iran Air CEO’s announcement, unofficial sources had reported that the deal was canceled. An aviation outlet, which is said to be associated with the United States’ Paine Field Airport, initially cited sources in both Boeing and Iran Air as saying that the deal was “dead” because “Turkish has decided to take delivery of TC-LJK”.

Soon after, reports by certain local media close to opponents of the government of President Hassan Rouhani claimed that the delivery had been cancelled due to Iran Air’s inability to afford the payment of the first installment, amounting to $75 million.

Parvaresh dismissed the claim as unfounded.

Industry analysts had been doubtful about the delivery of the Boeing 777 from the start, as Turkish Airlines had paid almost all the cash needed to purchase the plane.

“It is very strange that Turkish Airlines would cancel an order so late in the build process when they had already paid millions in pre-delivery payments and this comes just days after the airline accepted the delivery of a new, lease Airbus A330 from Intrepid Aviation,” Saj Ahmad, chief analyst at StrategicAero Research, told Financial Tribune earlier this month.