One can't remember the last time that Taiwan was this popular. Although typically brushed aside as a troublemaker and an unwanted orphan in the international community, Taiwan has suddenly become a hot item in the eyes of the US and a number of European countries over China Airlines' aircraft procurement plan. Should the airline go with Boeing or Airbus? That is a question much more complicated than what is being depicted by those critics of the Taiwan government's role in this matter.
Thus far no official contract or agreement has been signed between the airline and Airbus. It is common sense in the business community that a deal is never final until it is on paper and signed. As for the allegation that China Airlines had already made an "oral agreement" with Airbus, one can only say "what a joke." This is a purchase involving billions of US dollars that would require a carefully-drafted and lengthy contract -- it is not a deal that can be sealed with a handshake. Yes, a verbal agreement can be legally binding, but only if both contracting parties intend it to be so. One can hardly imagine this is the case in view of the money involved.
Since no deal has been done, the field is still open for both Boeing and Airbus. The buyer always wins when there is competition, so Boeing's entry into the race should be welcomed. Both manufacturers have reportedly indicated a willingness to lower their initial offers. That is a good thing for Taiwan in every sense. Whichever one offers a better bargain will get the deal. But it is naive to think that a lower sales price is always a better bargain.
China Airlines says its decision will be based on issues such as maintenance and repair costs and the need to "unify" aircraft models. The need to "unify" models would score some points for Boeing, as the airline has more Boeing aircraft in its 54-plane fleet than Airbuses, of which there are just 17. In addition, Boeing has reportedly indicated a willingness to help China Airlines maintain and repair its Airbus planes should the company win the deal.
Should Taiwan's political interests and foreign ties be taken into consideration with this deal? The answer is yes. Since the government owns more than 70 percent of China Airlines' stock, it naturally has a say as the majority stock holder. This hardly amounts to political interference. To the government, the nation's political interests are naturally a factor to consider. The people of Taiwan should in fact be outraged were it not to do so.
In any event, Taiwan is neither the first nor the last country to mix business with politics. Virtually no country in the world, except the US, would take Taiwan's money and sell it arms precisely because of the political considerations they hold.
However, this in no way means that Boeing is free to rip Taiwan off, just because the US is Taiwan's key ally. How to strike a deal that is most compatible with Taiwan's business and political interests -- that is a truly challenging task.
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