STAR-BULLETIN / 2001
Hawaiian Airlines is one of the users of the Boeing 717-200, which Boeing has been struggling to sell. Boeing is now emphasizing the plane as well-suited for corporate use.
Boeing pushes 717
to corporationsThe company is trying to bolster
slow-moving sales of the aircraft
SEATTLE >> It may not be the best time to pitch a new corporate jet to cash-strapped companies, but that's not stopping the Boeing Co.
At the European Business Aviation Convention & Exhibition in Geneva yesterday, the Chicago-based aerospace manufacturer announced it will make a version of its low-selling 717-200 available as a corporate jet -- which can be outfitted with work stations, meeting spaces, videoconferencing facilities and high-speed Internet access provided by the company's Connexion by Boeing service.
"The key element here is optimizing capital, people and time," said Thad Dworkin, sales director, Boeing Commercial Airplanes. "This airplane can save significant time in the travel process, which will reduce many of the hard costs of air travel -- air fare, hotels, food and entertainment -- as well as the 'soft' costs: time spent in transit, at terminals, waiting at the gate, delays at baggage claim and waiting to get a taxi or rental car."
Boeing already sells its Boeing Business Jet, a version of the 737-700, which can be outfitted with showers, beds and other flying luxuries. The unfinished jet sells for about $40 million with another $10 million or so for the interior. The program has been more successful than Boeing expected, said analyst Paul Nisbet of JSA Research. Since 1996 -- when Boeing announced the program, anticipating six or eight orders a year -- the company has received orders or commitments for more than 80 planes.
Boeing believes the new offering will help bolster its 717 jet program in Long Beach, Calif., said spokesman Bob Saling. There have been no new orders for the plane this year, the backlog of planes to be built has dwindled to 36 and the line is producing only one jet a month.
About 3,000 engineers, production workers and support personnel work on the program.
Last year, American Airlines returned a couple dozen 717s inherited in its acquisition of TWA. Boeing was able to get AirTran Airways to lease 22 of them, but the low-fare Orlando, Fla.-based carrier cut nine planes from its previous order for new 717 jets. Other 717 customers are Hawaiian Airlines, now in Chapter 11 bankruptcy protection, and Midwest Airlines.
The 717-200, which seats about 100 in commercial use, would be configured to seat 40 to 80 people in a first-class or business-class configuration for the 717 Business Express program. It has a range of about 3,500 miles .
Typically, the Business Express plane with an unfinished interior would sell for a little less than the 717-200 list price of $35.5 million to $39.5 million, said Saling. Boeing itself won't build the interiors, but will help the companies work with a third party to install the necessary equipment.
Boeing is in talks with a few customers, Saling said, though he declined to identify them and said there are no firm orders yet.
"It's enough to feel like we had something to move forward with," he said. "We realize that we may be in this (downturn) for a little while, but things are going to get better."
Boeing is looking ahead to a recovery, hoping to find a new niche to expand its 717 sales, Nisbet said. But it may take some time, and companies may not rush back to travel even when the economy does fully recover.
"Right now the market's pretty darn soft," he said. "A lot of businesses have gotten used to the idea of not traveling that much."
