Daily Management Review

Even as Questions Linger Over Earlier Deals, Iran Seeks More Aircrafts


Even as Questions Linger Over Earlier Deals, Iran Seeks More Aircrafts
While trying to overcome hurdles to deals worth some $50 billion with Airbus and Boeing, Iranian officials and Western industry sources  were quoted in the media saying that Iran has expanded its search for aircraft and is looking to order dozens more jets.
Preliminary discussions with several potential sellers including Japan's Mitsubishi, which is developing a new regional jet were held by Iranian airline executives attended the Farnborough Airshow in Britain over the past week, the sources reportedly told the media.
"Iran is planning to buy some 50 more airplanes of various types soon," an Iranian official said.
Simultaneously,  in an effort to resolve headaches surrounding the financing of existing deals to buy some 200 jetliners, needed to renew its fleet, Iran is continuing to meet Airbus and Boeing officials.
Taking advantage of an agreement between Tehran and world powers to ease sanctions in exchange for curbs on Iran's nuclear activities, the world's two largest planemakers struck provisional deals with IranAir earlier this year.
"Yes, there are problems, financial and political, but there have been several meetings with Boeing and Airbus top authorities particularly in the past few weeks in order to resolve the issue and to find a way to overcome the remaining obstacles," an Iranian official close to the talks said.
The potential for further plane purchases by Iran are scheduled to be discussed between officials from Airbus and the ministry of roads and urban development in Tehran on Sunday, reported Iran's Fars News Agency.
Airbus could not immediately be reached for comment.
To discuss the mechanics of their tentative deal to sell or lease 109 jets to IranAir, Boeing representatives are also expected to visit Iran before the end of the month.
Since Boeing and Airbus use a large number of U.S. components, sales of Boeing and Airbus aircraft to Iran could be blocked if the Senate confirms and barring a presidential veto, a proposal brought and passed by the U.S. House of Representatives this month.
As questions hover over part of the $27 billion deal between Airbus and Iran, signed in January, the latest contacts between Iran and Western planemakers takes place in such an environment.
Iran was cooling towards the purchase of 12 A380 superjumbos that were part of the provisional deal, said people familiar with the matter.
Airbus subsequently announced a cut in A380 production.
"Some Iranian critics of the deal argue that we don't need big planes that will only be used by those traveling to America or similar destinations. We will evaluate that part when the time comes ... One solution is to buy around 50 other planes instead," a senior Iranian official said.
To help "resolve their side of problem, including the financing issue", the official urged Western governments and manufacturers to intervene.
"It will be similar, but on a smaller scale, to what we have bought so far", he said when asked what types of aircraft Iran could buy.
Fearing their money could be at risk if sanctions are restored, many Western banks are reluctant to back the aircraft deals.
While aircraft industry sources say financiers in the UAE and China could play a role, the senior Iranian official said Italian and German banks had expressed interest in taking part.

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