Even More Black Eye: Qatar Airways Flies Brand New Boeing 787-9’s Back To The US

[patplan]

Qatar Airway Flies Brand New Boeing 787-9's Back To The US...Yesterday (27th December 2019), four brand new 787-9 Dreamliners made their way to Doha for a Qatar Airways delivery. But when they got there, the airline returned them to the United States. Here’s why…

An unsatisfactory delivery
After a particularly brutal year (https://simpleflying.com/boeing-2020-domination/), Boeing was quite keen to fulfill its Dreamliner order with Middle Eastern carrier Qatar Airways. The airframer wanted to ensure that it delivered some of Qatar Airways’ 787-9s by the end of the year. The airline was expecting seven aircraft before 2020. And, true to its word, Boeing delivered Qatar Airways the aircraft. Four 787-9 Dreamliners were spotted making their way to Qatar with the remaining three expected to arrive the following day. However, the delivery was not as smooth as it sounds. The four aircraft flown from Seattle to Doha (https://simpleflying.com/qatar-airways-huge-influx-of-brand-new-boeing-787-9-aircraft/) on 27th December 2019 are now on their way back to the United States.

It appears that in Boeing’s haste to produce Qatar Airways’ delivery, a key detail was missed. The new state-of-the-art Qsuite (https://simpleflying.com/qatar-new-q-suite-boeing-787-9/) that Qatar hoped to debut on the aircraft has not been fitted. And unfortunately, that’s a massive mistake that has led to the aircraft being sent back to Victorville in the United States. Not only does it look bad in terms of customer satisfaction but the integrity of both the airline and airframer’s environmental policies has also been tarnished. Not to mention the significant cost associated with flying the aircraft back and forth...========
The Boeing's new debacle with the 787's occurred even after the safety and quality issues had been brought to light by whistleblowers' reports, the exploding battery incidents, the engine troubles, and so on...

Sources:
- https://simpleflying.com/qatar-airways-flies-brand-new-boeing-787-9s-back-to-the-us/
- https://www.businessinsider.com/boeing-787-dreamliner-airline-complaints-quality-production-2019-8?r=US&IR=T

[Fly Aiprt]

Picture of the unistalled Q-Suite


https://cimg5.ibsrv.net/gimg/pprune.org-vbulletin/700x700/41656882320_123a59e27b_o_700x700_df8dd33340c8e98ab326fdd2ec1 bd28c16fd1ae4.jpg

[MechEngr]

That seems less like an oversight than an attempt at filling in a triangle on the Pert chart. Good job MBA holders. Good job.

[Fly Aiprt]

Just read in one of the linked website comments, that the delivery was to take place in Charleston, not in Qatar, and the lack of oversight might not be due to Boeing.

[Gostomel7]

Boeing are not going to deliver circ $1B worth of aircraft without customer giving go ahead. Likely a/c delivered on schedule & completed local regulatory procedures before being repositioned to Victorville to await client selected interior (which may not have been ready on schedule). Just a guess but to suggest that the airframer rushed delivery to customer is difficult to believe.

[NutLoose]

Perhaps there was a penalty clause for none delivery, hence delivery took place to satisfy that contract requirement and the aircraft then returned for fitting out, stranger things have happened in life.

[student88]

I don't believe this story one bit and I'd be inclined to suggest that some of the details are incorrect.

You don't just forget to install a cabin. Suites/seats etc are ordered with huge lead times and are delivered to a just in time production time scale..

I smell a rat.

[kiwi grey]

Perhaps there was a penalty clause for none delivery, hence delivery took place to satisfy that contract requirement and the aircraft then returned for fitting out, stranger things have happened in life.
I thought legal "delivery" took place at the factory, not at the customer's home airport.

I'm sure there's a lot more to this than meets the eye
Most peculiar

[India Four Two]

I thought legal "delivery" took place at the factory, not at the customer's home airport.


I've read that "delivery" often takes place offshore, in International airspace, where there is no liability for sales tax.

[Ken Borough]

I've read that "delivery" often takes place offshore, in International airspace, where there is no liability for sales tax.

*ping*! I think you'll find that a certain Australian airline used to fly some 747s into international airspace for document execution but they were relatively short flights off the US west coast.

[UltraFan]

Perhaps there was a penalty clause for none delivery, hence delivery took place to satisfy that contract requirement and the aircraft then returned for fitting out, stranger things have happened in life.

This actually sounds plausible. Penalties for late/non-delivery must have been greater than the cost of "rectifying deficiencies". The sad part is that lawyers and accountants still run Boeing. And they obviously don't care about the company's reputation... what's left of it.

[NOC40]

Esp given the date it's not inconceivable that the delivery was agreed so B can book it as a sale (and reduced inventory) for their year end accounts

[DaveReidUK]

Al Baker has form when it comes to messing manufacturers around, as Airbus also found out to its cost a couple of years ago with the last-minute cancellation by Qatar of some A350 deliveries.

[KelvinD]

I believe the QSuites were not fitted because...they don't fit! Apparently, someone thought it would just be simple to use the Qsuite as fitted in their 777s but, due to various dimension related factors, the Qsuites are too broad and a redesign has had to take place. Apparently, you can't just shave a couple of inches off the side!
I posted on this yesterday as the aircraft were en route to Victorville:
https://www.pprune.org/10649048-post267.html

[UltraFan]

Al Baker has form when it comes to messing manufacturers around, as Airbus also found out to its cost a couple of years ago with the last-minute cancellation by Qatar of some A350 deliveries.

A slightly incorrect description. It was anything but "last minute cancellation". Qatar cancelled four planes that were overdue on delivery in accordance with the contract. Was it a nice thing to do? I don't know. Did they have full legal right to do it? Yes, they did, and Airbus agreed with that. As for "to its cost", the planes were sold to another customer.

And what does it have to do with Boeing sending incomplete planes to customers?

[KelvinD]

It gets better/worse:
A7-BHC, A7-BHF & A7-BHG were delivered yesterday, making the trip from Paine Field to Doha.
As of now, they are all in an extended line over Greenland, making the trip from Doha to Victorville!

[jimjim1]

It gets better/worse:
A7-BHC, A7-BHF & A7-BHG were delivered yesterday, making the trip from Paine Field to Doha.
As of now, they are all in an extended line over Greenland, making the trip from Doha to Victorville!

All at 43,000ft, 480kts gs.

https://cimg9.ibsrv.net/gimg/pprune.org-vbulletin/1366x768/qatar_delivery_033401460e35a9f994fc109f83a210a7c1de449e.png

[Maninthebar]

It gets better/worse:
A7-BHC, A7-BHF & A7-BHG were delivered yesterday, making the trip from Paine Field to Doha.
As of now, they are all in an extended line over Greenland, making the trip from Doha to Victorville!

So the frames DID, Hobbitt-like, go there and back again.

Speculation from me: this conforms to the 'delivery as per contract' theory. In this case the contract DID specify that the cash would be payable on receipt at Doha. Inconceivable that the non-existence of fittings was a surprise to the supplier or customer so we should assume that they are conniving* to support BA's cashflow.

* Other, less perjorative, terms are available

[parabellum]

Delivery of Boeings to non USA customers that I know of have all taken place off-shore, as previously mentioned, to avoid tax and the aircraft don't even get airborne until the final payment is in Boeing's bank account. The delivery of the 500th B737-200 was delayed whilst the final payment was transferred.

[inOban]

Delivery of Boeings to non USA customers that I know of have all taken place off-shore, as previously mentioned, to avoid tax and the aircraft don't even get airborne until the final payment is in Boeing's bank account. The delivery of the 500th B737-200 was delayed whilst the final payment was transferred.
Surely the cash must be in an escrow account. If it was in Boeing's a/c before takeoff, then tax would have to be paid?

[Auxtank]

I thought legal "delivery" took place at the factory, not at the customer's home airport.

I'm sure there's a lot more to this than meets the eye
Most peculiar

Absolutely. Not only that but with such an order there will have been a Qatar Buyer on site for the duration of the build to be part of the sign-off team before departure of the finished aircraft with the shiny "car keys".

This thread is fake news.
Let's move on.

[tdracer]

While I'm no expert in Qatar tax laws, it's actually not uncommon for an operator to request aircraft delivery - even if incomplete - before a certain date. This allows the operator to take advantage of certain tax loopholes.

About 30 years ago - when Boeing was busy certifying the 767 with PW4000 engines - Lauda agreed to buy one of the flight test aircraft. BUT, Lauda needed to 'take delivery' before a certain date - which was prior to cert - to take advantage of an Austrian investment tax credit (or something along that line). So right in the middle of the flight test program, they flew the 767 to Austria. Papers were signed, pictures were taken, money changed hands, and then they flew the 767 back to Seattle and carried on with the flight test program.

When $millions in tax breaks are at stake, the cost of a round trip to satisfy the tax man is minor.

[BDAttitude]

I guess you can write it off one year earlier by taking delivery in late 2019 instead of early 2020. If the company was making profit I could understand that ... the spreaded rationale however is, well, odd.
And that the planes travelled forth and back can be taken as a fact. So definetly worthwile talking about.

[Rwy in Sight]

For those with experience on receiving an aircraft from the production line; is the delivery always on the airline's home airport or at the manufacturer's facility.

Also how easy is to install those special seat/suits after the aircraft is completed and flow away?

[Spooky 2]

For those with experience on receiving an aircraft from the production line; is the delivery always on the airline's home airport or at the manufacturer's facility.

Also how easy is to install those special seat/suits after the aircraft is completed and flow away?


It can be done several ways and this report is typical internet misinformation. I have seen Boeings flown from the 737 delivery line at Boeing Fied right into SEATAC and immediately put into service. Have seen MD1's flown from MJV directly to the home base of the respective airline and seen BBJs flown to PDX so as to avoid US sales tax. No one size fits all, and this writer simply does not know what he is talking about. I cannot imagine that any airline like Qatar does not have a represntive at Boeing to sign off on the finished product prior to the final payments prior to delivery. Some airlines have full time reps stationed at Boeing just to conduct these predelivery ops.

Probably not that hard or time consuming, to install the new seating config.

[tdracer]

For those with experience on receiving an aircraft from the production line; is the delivery always on the airline's home airport or at the manufacturer's facility.

Also how easy is to install those special seat/suits after the aircraft is completed and flow away?

Actual aircraft delivery is highly variable - Boeing has a 'Delivery Center' in Everett Paine Field, and another at Boeing Field (for 737s) - there are sometimes quite elaborate delivery celebrations (several years ago I was at the Everett Delivery Center for a flight test pre-flight, while I was there, there was a very elaborate delivery celebration for an African operator that was taking delivery of it's first 787, complete with dancers decked out in some traditional African dress). Sometimes the handoff occurs at 35k someplace west of Washington state over the Pacific Ocean, and sometimes it occurs at the operators home base. Again, little first hand knowledge, but I suspect tax laws have a lot to do with where the actual 'delivery' takes place. An airline rep always inspects a new aircraft prior to acceptance, and one of their pilots nearly always flies it on the customer acceptance flight (some real small operators will delegate that to the Boeing pilots, but that's rare). The idea that the aircraft left for Qatar without Qatar being fully aware of the condition of the aircraft is quite simply ludicrous...

Interior installation is just as varied - what Boeing delivers to the operator can be anywhere from a complete, certified interior ready for service to a basically bare aircraft aft of the flight deck wall with little more than provisions for the interior installation (I don't recall the exact words, but there is FAA cert paperwork that basically says the aircraft is not certified to carry passengers, that's used when delivery doesn't include a complete interior) . At one time it was common for operators to take delivery in Everett without an interior, they'd tow the aircraft to the south end of Paine Field, and another company would install the interior and certify it via an STC (doesn't happen anymore because that company isn't at Paine anymore - so now they'd have to fly it somewhere else).

In short, Spooky is right, the writer doesn't have a clue (as well as a few posters on this thread).

[Seat4A]

https://cimg3.ibsrv.net/gimg/pprune.org-vbulletin/1035x706/1qr_ab381539a4c34bb936c1938aa86274a7aa82dbb1.png

Source link

https://twitter.com/AeroimagesChris/status/1210798997368999936

[mkruletheair]

>>I cannot imagine that any airline like Qatar does not have a represntive at Boeing to sign off on the finished product prior to the final payments prior to delivery.

Qatar have 4 permanently reserved parking spaces at the front of the Marriott Airport in Toulouse. I guess they are not there to lobby for a Tour de France stage.

[RickNRoll]

Absolutely. Not only that but with such an order there will have been a Qatar Buyer on site for the duration of the build to be part of the sign-off team before departure of the finished aircraft with the shiny "car keys".

This thread is fake news.
Let's move on.
what's not fake is that line of planes flying back. That's just not normal delivery practice.

[megan]

That's just not normal delivery practiceYou might want to read post #22.

[cappt]

At my airline company personnel always travel to the manufacturer and perform an acceptance inspection and check flight before receiving the aircraft.

[Grebe]

Many years ago- to avoid WA state taxes, they would fly down to portland, get papers ready, and while doing a touch and go, sign appropriate documents.
I knew one of the pilots involved . . .

[megan]

Many years ago- to avoid WA state taxes, they would fly down to portlandHave heard of business being conducted 12 miles off the coast, ie in international waters/airspace, to avoid country jurisdictional oversight.

[DaveReidUK]

Many Airbus deliveries from both Toulouse and Hamburg involve an odd dog-leg through UK airspace, presumably for some sort of tax wheeze.

[Bidule]

At my airline company personnel always travel to the manufacturer and perform an acceptance inspection and check flight before receiving the aircraft.

Acceptance and Delivery are different things. Acceptance is technical and Delivery is financial and legal.....
And in many instances they do not occur at same location.

.

[Diana777]

Kelvin has it right, except for the type. They thought the A350 qsuites would fit the 787s. The aircraft were delivered to Doha, as per contract and then sent back into storage whilst QR is in 'decision paralysis' mode. They don't have crews ready to fly them anyway.

[WHBM]

These are the first 7 B787-9 for Qatar Airways. For a type which typically delivers 2-3 weeks after first flight, some have been hanging around at Boeing since a first flight in September, while all the rest of the production for others delivers as normal.

My hunch, adding together the various issues discussed above, is that Qatar have contracted separately, not through Boeing, for the cabin fitout, to be installed in the USA, and that the Boeing contract stipulated airframe delivery point in Qatar. Thus when it was apparent the fitout contractor was not going to be complete by the end of the year they were just flown to Qatar, the airline told "here you are, our bit of the contract complete, sign here", and then flown back. Probably about USD 1 bn then transferred. Boeing need all the cash they can get at present.

[esscee]

Maybe one of "Baldrick's cunning plans"?

[nike]

Not many business's run their financial year Jan-Dec.

Apr-Mar is commonly used.

Tax years are similar.

[homonculus]

There is that small insignificant country between Canada and Mexico that proves you wrong - tax year is January to December ;)

[Maninthebar]

As is the Qatar tax year, so probably made sense for all parties

[WHBM]

There is that small insignificant country between Canada and Mexico that proves you wrong - tax year is January to December.
Likewise Ireland. They changed from April in 2002. I'm not being trivial, there's probably more leasing fleet registered in Ireland than anywhere else comparable, and the whole reason is the tax breaks offered.

[daved123]

Likewise France.

[cappt]

Acceptance and Delivery are different things. Acceptance is technical and Delivery is financial and legal.....
And in many instances they do not occur at same location.

.
Of course. If your new jet was missing a major interior component you'd sign off the acceptance which would be required for the delivery to take place? Maybe Qatar doesn't bother with such trivial details as acceptance inspections? This article and thread is really "low intelligence", yawn...

[Viscount Way]

Absolutely right. 737-200 Line Number 500 was held up pending final payment. A good party spoilt after all the GF glitterati had gathered in the US! It was only a cash flow cum bank hold up though. Not like this, which must surely be a well-organised contractural wangle. Not easy presumably to find so many crews to operate these flights. Good day’s work for somebody though. “Tough in the Gulf” we used to say....

[OldnGrounded]

There is that small insignificant country between Canada and Mexico that proves you wrong - tax year is January to December ;)

No. While many entities in the US use the January-December calendar year as a tax year, and some (including individuals) are required to, many others use fiscal years, which are 12-month periods that may end on the last day of any quarter -- March 31, June 30, September 30 or December 31.

[Deaf]

Boeing probably has a quarterly financial report wef 31 Dec. A few extra 787 "deliveries" might just get the figures up to horrific

[Bidule]

Of course. If your new jet was missing a major interior component you'd sign off the acceptance which would be required for the delivery to take place?

Probably more frequently than one thinks, it may occur that buyer and seller decide to accept the aircraft not fully ready, if both parties have some interest doing so; the discrepancies are listed as reserves. As mentioned in some posts above, it may be for a lot of reasons including taxes (end of a specific regime for instance) or to benefit from investors support before a given date.
In such case, both parties agree on possible compensations and a schedule to correct which should have not been accepted.

.

[srobarts]

Boeing probably has a quarterly financial report wef 31 Dec. A few extra 787 "deliveries" might just get the figures up to horrific

Boeing's financial year ends Dec 31st. I worked for 20 years for the sales side of an American corporation The emphasis was always on pushing as much out of the door by midnight Dec 31st as possible.

[KelvinD]

This speculation about taxes etc puzzles me. I am assuming the implication here is that there is a form of sales tax payable. In Europe, the equivalent is VAT (Value Added Tax) and if one pays VAT when purchasing an item and that item is then exported, the VAT is refundable so the purchase effectively is a zero tax item. Doesn't the US have a similar form of tax break available for exports?
Also, I thought I had read that Washington State gave Boeing all manner of tax breaks and, as for Qatari taxes, I am sure there won't be any as the airline is government owned.
Someone mentioned tax related wheezes such as flying offshore for the delivery paperwork to be completed. If that was the case, wouldn't all customers do the same? In the case of the Qatari aircraft, they could have been flown from Seattle to Victorville via a large loop over the Pacific? Also, if delivery had not been finalised when the aircraft left Boeing, why would Boeing allow the new owner's crew to make the flights? "When you own it, you can fly it".
There have been occasions when British Airways have taken delivery of new aircraft which needed new seating arrangements fitted. In those cases, BA flew the aircraft to London, then on to Cardiff for the seat installation. If there had been potential tax advantages to doing the same as Qatar, I am sure the BA bean counters would have spotted this and taken advantage.

[EDML]

In the US there is no federal sales tax. There are different sales taxes in different states and they are handled differently (e.g. refund on export).

[radiosutch]

This speculation about taxes etc puzzles me. I am assuming the implication here is that there is a form of sales tax payable. In Europe, the equivalent is VAT (Value Added Tax) and if one pays VAT when purchasing an item and that item is then exported, the VAT is refundable so the purchase effectively is a zero tax item. Doesn't the US have a similar form of tax break available for exports?
Also, I thought I had read that Washington State gave Boeing all manner of tax breaks and, as for Qatari taxes, I am sure there won't be any as the airline is government owned.
Someone mentioned tax related wheezes such as flying offshore for the delivery paperwork to be completed. If that was the case, wouldn't all customers do the same? In the case of the Qatari aircraft, they could have been flown from Seattle to Victorville via a large loop over the Pacific? Also, if delivery had not been finalised when the aircraft left Boeing, why would Boeing allow the new owner's crew to make the flights? "When you own it, you can fly it".
There have been occasions when British Airways have taken delivery of new aircraft which needed new seating arrangements fitted. In those cases, BA flew the aircraft to London, then on to Cardiff for the seat installation. If there had been potential tax advantages to doing the same as Qatar, I am sure the BA bean counters would have spotted this and taken advantage.

How do you know Qatari pilots were flying them?
Just askin for a friend....

[MELT]

Hello

I have already posted a response once on this, but for some reason it has been removed. Not quite sure why and wanted to highlight in this day and age how crazy some things can be. Below, more or less, is my post again

If these B787 delivery flights are purely for financial/legal reasons then, Greta Thunberg would in this instance be quite correct if she said "The law is an ass". This means that "An application of the law that is contrary to common sense", and the use of the word ass is in the British sense referring to a donkey!

[FlightDetent]

Perhaps it is time to spend a moment's thought for all the staff that got involved. Lawyers, Accountants, Flight Ops back-office, Ground handling, Pilots.

Both on the side of BA and QR, everyone must had been plucking their hair out at the absurdity, screaming their brains out. Still, by the end of the day it was the best available option.

[DType]

I guess this would never apply to anything as costly as a B787, but we used to get a lot of orders at the year end from people using up their budget before it evaporated. After the previous management had lost several orders (Sorry, we can't deliver before the year end), I arranged to have several machines all crated up and ready for their delivery address labels each March. If the rules are funny-peculiar, you may as well take (sane) advantage of them.

[KelvinD]

The Qatar source web site reports that the 7 were delivered, Paine Field to Doha, with only the economy cabins fitted. Next reports say they have now positioned to Victorville for business class cabin fitting (as originally speculated).

[Ivan aromer]

The Qatar source web site reports that the 7 were delivered, Paine Field to Doha, with only the economy cabins fitted. Next reports say they have now positioned to Victorville for business class cabin fitting (as originally speculated).
Whatever tbe reason, thats an awful lot of wasted gas. Better not tell Greta about the emissions.

[MELT]

Ivan, my point exactly. I think we can see aviation being targeted more by environmentalists than it before. Offsets are all very well but I think the aviation industry, along with others, really needs to clean up it's act. We can be sure that Qatar Airways have done their homework and these flights make total sense from a financial point of view maybe even taken offset into account. However the ammunition it can give to those who say we should address our emissions more seriously is IMHO almost crass.

Happy New Year to all.

[starling60]

And Spain and Italy, tax year 1st Jan to 31st Dec

[navefenix]

Rightly said, legal yes, but...ethically and . politically ( and climate sense..) not so much

[Dave Gittins]

Maybe they need some crew hours building .. like when I was in Qatar in 2008-2009 and almost empty 777s were shuttling back and to to Dubai filling in for A320s to get crews trained.

[usbhub]

Boeing posts zero new airplane orders in January 2020.