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Star Eager For Looming Air Canada Aircraft Order


Oct 22, 2003



 

Air Canada is within weeks of awarding a firm order for 100 new aircraft, making it the first carrier of a group of four Star Alliance members that plan to buy planes of 70-110 seats that will have standardized equipment and configurations.

Star CEO Jaan Albrecht told a DAILY editorial meeting in Washington that the airline has not settled all the details on the order, but a decision is "about to come." The three other Star partners --Lufthansa, Austrian and SAS -- will realistically not place their orders until early 2004, Albrecht said. The expected orders come after the airlines, in cooperation with Star executives, worked for months to agree on a "Star standard" for the aircraft for everything from engines to avionics to coffee machines.

Air Canada CEO Robert Milton last month in Montreal predicted the order, one of its largest in recent history, might be signed by the end of October (DAILY, Sept. 12). The airline is choosing among the Airbus A318, Boeing 717, Bombardier CRJ and Embraer 170. Air Canada is considering splitting the order, which Albrecht acknowledged is an option that has been discussed by the other three Star airlines.

While signaling which orders it might place in the near future, Air Canada might not sign the final deal until it emerges from the equivalent of Chapter 11 protection. Albrecht said all the Star airlines will place their orders individually, and winning financing for the orders will be up to each carrier.

Separately, Albrecht told the International Aviation Club that Star's leadership position "will not change" despite Swiss joining oneworld and the Air France/KLM merger. He believes competition between alliances will grow stronger, "a situation that I would call an interesting challenge, rather than a threat." Next year, Star will have 27% of the world's traffic, followed by SkyTeam with 23% and oneworld with 19%, including their recent additions.

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