Icelandair Orders Two Boeing 787 Dreamliners

SEATTLE, Feb. 25, 2005 -- Boeing [NYSE: BA] and Icelandair today announced a firm order for two all-new 787 Dreamliner airplanes with which the carrier will expand its operations on long-range routes from Iceland, and develop its fleet.

Icelandair ordered 787-8s, which will be delivered during 2010. The carrier is evaluating the two engine options, the General Electric GENX (GE Next Generation) and Rolls-Royce's Trent 1000. The order is worth $240 million at list prices.

"The 787 Dreamliner's unprecedented efficiency, economics, range and passenger comfort are ideally suited for our operations and our commitment to providing superior service to our passengers," said Hannes Smarason, chairman of the Flugleidir Icelandair Group.

Boeing now has 193 announced orders and commitments for the 787. Negotiations continue with airlines around the world. Icelandair becomes the 16 th airline to select the 787 in just 10 months following the Dreamliner's launch in April 2004.

"The 787's efficiencies and performance make it the perfect airplane to meet Icelandair's requirements for expanding its long-haul operations and to serve key global markets," said Marlin Dailey, Boeing Commercial Airplanes vice president for sales in Europe. "This deal extends a strong relationship between Icelandair and Boeing that goes back over 30 years."

The 787 will support Icelandair's expansion of its transfer traffic through Iceland by opening new markets in North America and elsewhere. Currently, the airline uses Iceland as a hub between six US gateway cities and 16 European destinations.

Icelandair operates 19 Boeing 757s and 767s for its scheduled service and Icelandair Group charter and cargo businesses. Its parent company, Flugleidir Iceland Group, last month purchased 10 Boeing Next-Generation 737s for its growing leasing venture.

Icelandair is one of the 13 subsidiaries of the Flugleidir Icelandair Group. The Group is central to the rapidly growing Icelandic tourist industry, and includes Icelandair, Icelandair Cargo, Icelandair Hotels, Air Iceland , Iceland Travel, Reykjavik Excursions, Icelandair/Hertz, Icelandair Ground Services, Icelandair Technical Services, Loftleidir-Icelandic and Icelandair Shared Services.

The technologically advanced 787 Dreamliner will use 20 percent less fuel than today's airplanes of comparable size, provide airlines with up to 45 percent more cargo revenue capacity, and present passengers with innovations including a new interior environment with higher humidity, wider seats and aisles, larger windows, and other conveniences.

The 787 will allow airlines to offer more of the comfortable point-to-point travel that passengers want. The 787's first flight is scheduled for 2007, with entry into service during 2008.

. . . the airline uses Iceland as a hub between six US gateway cities and 16 European destinations.

Not too shabby for a country with a total population of about 290,000 people.

I know . . . that was a lot to copy and paste from the article, but gee, not too shabby for a country with a total population of about 290,000 people!

I spent two 60 day visits to Reykjavik years ago. An interesting place. Good people. Terrible, dreary weather. But, apparently they know how to make things work.

This is good news, for me as a shareholder and as an Icelander if this will make this one of our largest companies stronger. I don´t remember was it Boeing that was making their planes able to carry more people or able to fly longer distances? The two biggest aircraft makers have different strategies for this, and I am afraid that if planes will be able to fly longer distances and that will become more the norm, Icelandair could loose over the long hair. If the big planes, many passengers aproach will win, we could be in better shape. Icelandair did not struggle much after 9/11, or at least it survived and in fact became stronger through that difficulty, now buying a sizeble share in one of Europe´s biggest low cost airlines, Easyjet, and many other investments, and my shares have doubled over a period of little over one year.

This company used to be, including our oldest shipping company and other campanies that all owned each other, the backbone of my parties power so to speak, the party, the Independence party protected those companies, wich where owned by a big portion of the nation, I f.e. got my shares from my grandfather that brougth them for me, and all his grandchildren when we were born, against the communistic and progressive parties in Iceland, that were trying to do everything to destroy them.

That protection, I admit, became way to much too often, but it was neccasery as the other parties gave their companies, who were not shareholder companies, in most cases, but publicly owned or in nobodys ownership (I know this is complicated, but this is the story of our political struggle simplicated), but now with the privatization of most of the other companies, and many free market efforts by our government wich was until recently under my parties leadership (we are still in it, and control the most) that bond has broken, as it is not neccasery any more and as the free market forces having run freely have changed the ownership of these companies and broken the link between the warious companies in unrelated bussinesses.

That is a good thing, but strangely are the socialdemocrats now going into the opposite direction, selling their newfounded Union to a huge companie that has all power over most of our media and much more, protecting this companie and helping way to much. Try to fly with Iceland air when going to Europe, you can if you want spend a few nights in Iceland on the stopower and exsperience our great nature and cultural life, hope to see you and your dollars ;)

The two philosophies are a little more complicated than that.

Airbus believes people want to fly in smaller airplanes from their home city to a major hub, then in huge airplanes from major hub to major hub, then get on smaller airplanes to fly on to your desired destination.

Boeing believes people want to fly from their home city to their desired destination in smaller airplanes.

I would think the Boeing philosophy would work best for Iceland as wouldn't you rather fly from Reykjavik to Venice or Reykjavik to Seattle, rather than Reykjavik to Amsterdam, wait, transfer aircraft, then fly on to Venice? Further, with a population of 290,000, I don't think Iceland will ever support A380 (550 - 800+ passenger) operations.

The Boeing 787 Dreamliner is the perfect fit for Iceland.

Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.