CAL says it won't give in to lobbying

China Airlines Co (華航) claims it will not be influenced by apparent heavy-handed political lobbying by the US government and Boeing Co in regard to a multi-billion dollar aircraft purchase, according to company executives.

Local media yesterday reported that Douglas Paal, recently appointed Taipei director of the American Institute in Taiwan (AIT), had met with China Airlines Chairman Lee Yun-ning (李雲寧) and other executives in an attempt to persuade the company to chose Boeing planes to fill the order.

The AIT declined to comment on any aspect of the reports while Boeing executives were unavailable for comment.

Roger Han (韓梁中), spokesman for China Airlines, confirmed that a meeting took place between China Airlines executives and AIT personnel. Han declined to name the attendees or the topic of discussion, but he did say the company would not be swayed by political pressure.

"A lot of the press reports have said Boeing is using political power to influence our decision. But the chairman of China Aviation Development Foundation and Minister of Transportation and Communications Lin Ling-san (林陵三) has said that the final decision is purely up to the company's management," he said.

"We will make a decision based on our professional evaluation, including technology and economic issues," he added.

China Airlines is currently pondering whether to fill a long-standing purchase order for 12 new mid-range jets with Airbus-made A330-300s or from one of Boeing's 777 range.

The purchase deal will replace 12 older A300-600Rs in an effort to modernize its fleet and hopefully improve its safety record, arguably one of the worst in the world.

Reports have speculated that Airbus has all but sealed the deal, winning the reported US$1.5 billion to US$3 billion sale by offering steep discounts of up to 25 percent off the price of each aircraft, a tactic it has used successfully recently to win orders over Boeing.

Sources in Washington informed the Taipei Times that the apparent decision by China Airlines to purchase the Airbus jets had shaken the US plane maker and "triggered very heavy US lobbying at the highest levels of government."

Han said however that the final decision by China Airlines would be the end result of a "very comprehensive and transparent evaluation process which is very fair to both manufacturers."

The decision would take into account "price and revenue potential and also if the aircraft suits the intended market or not," he added.

An Airbus executive declined to comment on whether it was close to cementing a deal with China Airlines, saying only that it was still too premature.

Commenting on reports of Boeing's displeasure at being undercut in terms of price by Airbus, the executive, who preferred not to be named, said the US airplane maker always resorted to this excuse when it lost out to its only rival.

Indeed, a report carried by the Seattle Post-Intelligencer on Tuesday quoted a Boeing salesman as saying Airbus has sliced prices on its planes so much to win market share that Boeing has lost some key sales rather than match the hefty and unreasonable discounts.

Toby Bright, leader of Boeing's commercial airplane sales, said his company was in danger of losing the year's biggest airplane order from Europe's EasyJet for more than 100 planes if it comes down to price alone, the report said.