Yesterday I wrote about Qatar Airways’ unusual delivery flights. The airline took delivery of four 787-9s from Boeing at once, with another three expected to be taken delivery of before the end of 2019.
The planes are ready on Boeing’s end, but the new Qsuites that are being installed on the planes aren’t yet ready, so Qatar Airways is nowhere close to putting these planes into service.
Well, there’s a further update with this saga.
In this post:
Another Three 787-9s Fly To Doha
As expected, at the moment a further three Boeing 787-9s are enroute to Doha, with the registration codes A7-BHC, A7-BHF, and A7-BHG.
So that means over the course of 24 hours Qatar Airways took delivery of seven Boeing 787-9s. That’s a lot of planes to take delivery of in a short period — especially when they’re not even ready — and clearly shows they had some calendar year deadline for doing so.
Qatar Airways Flies 787-9s Right Back To The US
Those four 787-9s that landed yesterday in Doha are already enroute back to the US. The planes flew from Paine Field in Washington to Doha yesterday and today they’re flying from Doha to Victorville in California, where the planes will be stored for some amount of time, and then I believe their interiors will also be installed in the US.
The nonstop flight from Paine Field to Victorville would have covered a distance of 953 miles, so that’s about two hours…
Instead the planes have flown 15,630 miles each, over 16x the necessary distance, with each plane flying for about 30 hours. When you multiply that by seven planes, that’s a lot of emissions.
Maybe some people thought that it was an overkill to take issue with a Qatar Airways Cargo 777 taking a 24 mile flight because of a customer, but I’m sure we can all agree this is outrageous.
Of course Qatar Airways has an environmental awareness page on their website, as does Boeing, so I’m not sure these flights fit into that.
Why Would Qatar Airways Do This?
I don’t think Qatar Airways did this “just because.” After all, operating 14 ultra long haul flights unnecessarily costs the airline a lot of money.
My guess is that this was necessary due to some sort of technicality. The airline formally took delivery of the planes from Boeing, so this likely comes down to some sort of paperwork issue of the plane needing to be properly registered in Qatar.
This might not have been an issue if the planes were heading to Qatar in the coming days, but I imagine it will be months and not days before these planes return to Doha.
If that is the case, it’s sad when bureaucracy gets in the way of doing the right thing. Even if this is due to some paperwork issue, I don’t think Qatar Airways should so easily be off the hook for this. Ultimately poor planning and coordination lead to this…
Air Canada does (or at least USED to do) the same thing. Aircraft picked up at Paine Field (Everett) and flown 200 miles off the coast into international waters. The aircraft is then officially "purchased" (though all the financial transfers have taken place before the aircraft departs the airport) then flown to Victoria (CYYJ). There, a commercial envelope which is then flown to Vancouver (CYVR) making this a "revenue" flight. The aircraft is then flown...
Air Canada does (or at least USED to do) the same thing. Aircraft picked up at Paine Field (Everett) and flown 200 miles off the coast into international waters. The aircraft is then officially "purchased" (though all the financial transfers have taken place before the aircraft departs the airport) then flown to Victoria (CYYJ). There, a commercial envelope which is then flown to Vancouver (CYVR) making this a "revenue" flight. The aircraft is then flown BACK to Paine Field for outfitting of passenger and aircraft systems. Since it is now officially a foreign aircraft, there are no taxes on subsequent work or material.
This was the way it worked many years ago for the B767 Air Canada fleet. There is an official record in my logbook. Qatar Airways is doing the same thing. It is a matter of scale....
"Even if this is due to some paperwork issue, I don’t think Qatar Airways should so easily be off the hook for this. Ultimately poor planning and coordination lead to this" Might be better to get the facts first before blindly speculating that the airline is at fault. Also, its a joke for this blog to talk about the environment given the carbon footprint of all the flying that is done for these articles.
Relax. The planet will be just fine.
This article is a treasure trove of comments of no one knowing what's going on but everyone thinking they do.
In fairness if your going to blame Qatar for poor planning over this then you should know exactly why it was done and be able to spell out why Qatar did what they did and how it could have been avoided.
But since all we really know is the aircraft routing its unfair to start throwing blame around.
It has, in part, something to do with the export license for the aircraft. When Qantas accepted the last of the 400ERs back in 2003, the aircraft was flown across the border for a landing in Canada, before being ferried back into the States for final painting. (It became the second Wunala Dreaming). It had to leave the country before it could come back for further work. There are tax implications.
I’d imagine it was a tax issue as a foreign carrier. Or, loaded up with interior outings normally dine in Dubai and shipped cargo back?
Im an American Airlines employee but my opinions do not represent the company i work for.
Aircraft are bought in basically 4 parts: Airframe (boeing), Engines (GE), Avionics and Interior. There is more to it but thats basically it. It comes out of the factory fitted with everything but the interior. Now Boieng and GE sales are subsidized by the US government through the Exim Bank. In order for Qatar to be able to...
Im an American Airlines employee but my opinions do not represent the company i work for.
Aircraft are bought in basically 4 parts: Airframe (boeing), Engines (GE), Avionics and Interior. There is more to it but thats basically it. It comes out of the factory fitted with everything but the interior. Now Boieng and GE sales are subsidized by the US government through the Exim Bank. In order for Qatar to be able to receive those grants it must take delivery of the airplane at their final destination on or before a certain date. Heres where it got tricky: they could have sent the planes to be fitted in California and then flown to Qatar and no, there was no risk of California local sales taxes otherwise there would be no Aerospace industries based there. Without knowing the full details I suspect that the EXIM guarantees were due at the end of 2019, Qatar airlines suffered a delay in the availability of the seats and they had to bite the bullet in the form of these flights. But this is a guess...
And man, thinking about asking California to waive its sales tax in order to reduce carbon emissions is seriously making me LOL because hell would freeze over before it happened.
California may love the environment, but it loves taxes much more.
I suspect this has to do with not wanting to take delivery of these aircraft in California, where they'd be subject to California sales tax.
Do you work for Boeing or Qatar airways? What makes you feel that you are entitled to make business decisions for them when you don't know what's involved?
Lucky, its fine that you wrote about their flights to doha and back to US but you really dont need to lecture them or criticize them without knowing exact reason. Btw its their plane, should we start criticizing you for driving your car around the town on carbon emossion ?.
And look at it this way. If this plane would have been delivered to UA, it would have flown 300-pound Americans around for 30 years straight. I'm happy it went to QR with a smaller footprint.
I don't understand the comments here. All you fat Americans eat so much food, you have a much greater impact on the environment than these 787s. All of you are disgusting.
Clearly financial accounting was the reason for pre-12/31 delivery. The primary technicality requiring foreign delivery is taxes. Delivery in the US generally means sales taxes for QR and no US tax benefits post-tax reform for Boeing. Tax complications for both companies likely also exist for delivery in Europe. So Doha it is.
Boeing might just want to make the year's delivery number look good. They might cover the cost for Qatar.
Nowadays, people know.
I believe Concierge Key, Global Services and Delta 360 members are exempt from global warming.
@David completely agreed. Strict adherance to law/regulations (which many people refer to technicalities/beaurocracies) is the "right thing" to do.
I will not speculate but it is likely QR being screwed because of the seat manufacturer's fault.
One of your sillier posts no doubt. Let's see, NO ONE wastes money that was spent via these flights, unless unavoidable, especially the Sheiks! There are legalities involved that can't be changed at the whim of a blogger.
Also, let's see, blogger who boasts of taking unnecessary flights everywhere, to boost readership and income, now decide he is Greta's sidekick? Pot calling kettle black?
Fiona, you are an idiot. The evidence supporting the science of global heating is extremely strong and Africa is already suffering and will suffer worse than more temperate regions.
Climate Ideology means the destruction of living standards for billions of people in the developing world (and the poorer residents in developed countries) who because of some whinging elites in affluent western countries, will not be able to see their living standards improve. See some of the comments above about taxing people out of air travel (but keeping the private jets for our royalty).
I am finding that more and more people are cottoning on...
Climate Ideology means the destruction of living standards for billions of people in the developing world (and the poorer residents in developed countries) who because of some whinging elites in affluent western countries, will not be able to see their living standards improve. See some of the comments above about taxing people out of air travel (but keeping the private jets for our royalty).
I am finding that more and more people are cottoning on to this at home in Africa, this ideology is a scam developed by colonialists.
My theory is that they got some flight hours in - similar to AA running the planes ORD to DFW empty for a week, then doing a ton of overkill hub to hub flights. Ultimately your check ride is based on take off and landing so they continue keeping 777 and 787 on short hops to keep the check rides easier, and build experience. Frankly if I was on the first Flight of any airline for any type i would want to know my pilot had some miles on them.
@Joe BA might hand over the planes in the US, but delivery for tax purposes is quite another matter. For the plane not to be treated as a US asset, and "for export" for tax and ExIm lending purposes, it must leave the USA, and not delivered and left to remain in the USA. I'm not familiar with Qatari taxes, but it could well be that to get the various advantages of that tax regime,...
@Joe BA might hand over the planes in the US, but delivery for tax purposes is quite another matter. For the plane not to be treated as a US asset, and "for export" for tax and ExIm lending purposes, it must leave the USA, and not delivered and left to remain in the USA. I'm not familiar with Qatari taxes, but it could well be that to get the various advantages of that tax regime, as well as to be documented for hypothecation purposes, it needs to be physically within the jurisdiction of Qatar.
@Callum I'll only say that there is no shame in being ignorant of science, but to be ignorant and to call others ignorant is something else. "The science is pretty easy to understand?" If you think so, you don't understand it. Pop scientists like Al Gore might consider this all cut and dry and "settled," but real scientists understand that climate is one of the most complex systems known to man.
If I know California, they flew these planes to Qatar first to avoid the sales tax...
This is nothing but useless speculation by a bunch of posers.
Hazarding a guess, but the order would have been heavily financed by US Govt Export-Import financing; which would have strict timelines attached and one of its covenants would require the aircraft to be “exported” in order to qualify for the financing.
1KBrad - No. Coal power stations didn't cause the last ice age. Nor does anyone say they did. Nor do climate change models rely on that happening. The science is pretty easy to understand - you're either a moron or are actively choosing not to understand it. Which is it? I'm betting it's the latter.
Ken Adams - Greta has personally saved far more emissions than she could possibly generate in her entire lifetime. How...
1KBrad - No. Coal power stations didn't cause the last ice age. Nor does anyone say they did. Nor do climate change models rely on that happening. The science is pretty easy to understand - you're either a moron or are actively choosing not to understand it. Which is it? I'm betting it's the latter.
Ken Adams - Greta has personally saved far more emissions than she could possibly generate in her entire lifetime. How could that possibly be the same as Lucky?
And since when has asking people to stop killing you and your future children (that may sound hyperbolic - it is not (pollution from burning fossil fuels literally kills thousands in this country - even if you want to pretend we have no impact on the climate) been "entitlement"?
What is unbelievable is that you fly for fun and don't care about emissions, but then smear QR for this.
Why don't you live what you preach?
Any relation to Greta? She has the same entitlement attitude....
Emissions? Really?
Those flights were probably less than .5% of all flights on that one day. BFD.
And that presupposes that those emissions are doing something legitimately harmful in the first place.
I guess all the coal fired power plants in place at the time caused the last ice age . . .
'Carbon offsets' are a joke, the damage is already done, no matter how much money you throw at it or trees you plant.
@Mak, Boeing only delivers airplanes (787) in PAE and CHS. The plane does not need to leave the airport or the US to be “delivered.”
Exporting is often part of financing or registration. Qatar probably paid cash and they could have used a structure with a N-reg to ferry directly to VCV if they wished. I suspect there is no interest for the airline or government to own an airplane that is not registered in Qatar.
First time on OMAAT we consider emissions - good stuff. Let’s spend a bit more airtime on that in the new year keeping this cool blog while considering the environment a notch more while doing so?
This has to do with avoiding taxes in taking "delivery" of these planes in Qatar, not Boeing's accounting. It also makes no sense that they needed to "pick-up" materials in Qatar, as it would make far more logistical sense to ship those materials directly to the place where they are to be installed.
The more interesting question is why Qatar delayed delivery so long, and why it is storing the planes in advance of outfitting...
This has to do with avoiding taxes in taking "delivery" of these planes in Qatar, not Boeing's accounting. It also makes no sense that they needed to "pick-up" materials in Qatar, as it would make far more logistical sense to ship those materials directly to the place where they are to be installed.
The more interesting question is why Qatar delayed delivery so long, and why it is storing the planes in advance of outfitting them (as opposed to outfitting them immediately). One possible inference from all of this is that Qatar has its own cash crunch or accounting issues that prevented them from taking a more orderly delivery and deploying them in a more normal fashion. It's all very strange.
Joe is correct. Ship in place is a common practice in the industry and plane doesn't even need to leave as long as customer signs off on the plane. Let's not automatically blame some Boeing accounting without, you know, actually knowing anything about the industry. Flying few times a year doesn't make you aerospace expert.
Boeing can deliver an airplane in PAE. If they get paid, the plane doesn’t even need to leave.
Registration is a different story and each country has different requirements. Qatar can’t fly the airplane under N-registration, nor can Boeing ferry the airplane post delivery.
I would imagine, without having the faintest clue like most here, it was insurance related
I do not think it is fair to criticize Boeing or Qatar if you don’t know the true reason. Also this is not true journalism and it is also not professional from One Mile at a Time to allow this. Get the facts before just posting a story to start gossip.
You jet around the world, almost always in first and business class, on COMPLETELY unnecessary flights. I don't think you have any right whatsoever to label any level of airline emissions to be outrageous...
Eskimo - Ahhhh, moronic comments as always. I'm curious where you're from. Do people dismiss you as a nut there, or have they helped form your wacky views?
There are likely customs and accounting reasons for this. Boeing maybe cannot record the sale revenue or drawback duty until the planes are exported. Qatar may require some patriation or import activity in order to register the planes. It’s likely that for any of the above to take place, the plane has to physically arrive in Qatar.
Qatar airways dont give a dan about fuel and emissions they have government money so they think they can do whatever plus they force their crew to carry suitcases checked in even for short flights so imagine in 777 17 crew with 17 more bags that they dont need and they are forced to carry just to burn some more of their proudly qatari made fuel...
Simple solution. Why not ask them ?
It has NOTHING to do with Boeing.
It is all Qatari reasons.
Could be authorities need to physically inspect the plane.
Could be like @Will say about parts.
Could be lessors requirements.
Could be QR needing to close the book by year end.
But not Boeing. All that matters is Boeing deliver the plane over international airspace. They can easily fly west for 15 mins and meet all requirements.
@Ryan
I...
It has NOTHING to do with Boeing.
It is all Qatari reasons.
Could be authorities need to physically inspect the plane.
Could be like @Will say about parts.
Could be lessors requirements.
Could be QR needing to close the book by year end.
But not Boeing. All that matters is Boeing deliver the plane over international airspace. They can easily fly west for 15 mins and meet all requirements.
@Ryan
I feel bad for naive little Greta. She is only a pawn for her parents. All her sailings is undone before the first 787 even entered Canada. So much for carbon offset. (which is a stupid idea too)
How dare...
My hunch is that this has to do with accounting at Boeing, and a possible discount Qatar received for taking actual delivery in Qatar. Otherwise none of this makes sense.
The planes have to be on the ground in Doha for the registration process to be completed.
They should rent the engines to air new zealand
This is a favor to Boeing and you're blaming Qatar Airways for this?
Have you contacted their PR departments and insist on an answer, especially Boeing one?
Something's rotten at OMAAT...
@RRJ
From Boeing’s 2018 Annual Report
‘Most of our defense contracts at our BDS and BGS segments and certain military derivative aircraft contracts at our BCA segment now recognize revenue under the new standard as costs are incurred. Under previous GAAP, revenue was generally recognized when deliveries were made, performance milestones were attained, or as costs were incurred. The new standard accelerates the timing of when the revenue is recognized, however, it does not change...
@RRJ
From Boeing’s 2018 Annual Report
‘Most of our defense contracts at our BDS and BGS segments and certain military derivative aircraft contracts at our BCA segment now recognize revenue under the new standard as costs are incurred. Under previous GAAP, revenue was generally recognized when deliveries were made, performance milestones were attained, or as costs were incurred. The new standard accelerates the timing of when the revenue is recognized, however, it does not change the total amount of revenue recognized on these contracts. The new standard does not affect revenue recognition or the use of program accounting for commercial airplane contracts in our BCA business. We continue to recognize revenue for these contracts at the point in time when the customer accepts delivery of the airplane. ‘
It was reported they needed to pick up parts of the Q Suites in Doha so they could install them in VCV. Also you shouldn’t be complaining about the amount of emissions that have been realized considering you travel nearly 400k miles a year.
@ DMPHL - Sorry to burst your bubble but that is just NOT how the accounting for long-term contracts work. They use percentage of completion revenue recognition. Therefore, if Boeing is done incurring the costs to build the plane, they recognize the revenue. And that revenue has been recognized over the Lifecycle of building that plane. The “delivery”, in this case, won’t really impact much. Also, revenue is recognized on the income statement...not the balance...
@ DMPHL - Sorry to burst your bubble but that is just NOT how the accounting for long-term contracts work. They use percentage of completion revenue recognition. Therefore, if Boeing is done incurring the costs to build the plane, they recognize the revenue. And that revenue has been recognized over the Lifecycle of building that plane. The “delivery”, in this case, won’t really impact much. Also, revenue is recognized on the income statement...not the balance sheet.
If you guys don’t understand how accounting rules work, stop discussing them.
@ Pertsey1110 Ugh yes you are correct. I am also NOT an accountant lol.
Thanks for recognizing the emissions implications of flights.
Almost certainly related to EXIM bank financing guarantees requirements. Www.exim.gov
Again, its Boeing...and they paid for the fuel.
I wonder if maybe Qatar’s financing for the planes has anything to do with some of this. The idea that they’re credit options could expire—of the terms degrading— sounds plausible, forcing deliveries while the line was open.
Doesn’t quite explain the flights, but plausible that’s a lender term also.
Suppose you just bought a new car but want to upgrade the tires and sound system at a garage a few miles from the dealer. Are you just going to drop it off there for a few days, or are you going to take it home and drive it around for a while -- maybe put a few hundred miles on it? If you wait until after the non-OEM work is done, are you sure the dealer isn't going to claim that the warranty has been voided?
Very hypocritical IMHO to criticize on an emissions basis for a flight which seems unnecessary while not truly knowing why yet there is plenty of discussion on mileage runs. Seems they are just as unnecessary.
I’m of the opinion that if no one knows the actual reason for the flights - why is it even being discussed - like gossip ? I’m sure there’s some sort of an explanation - and perhaps the Qatari government needs to have the aircraft physically touch soil- so the assumption is poor planning - wow - let’s drag them over the coals before there’s concrete evidence or an explanation - way off base on this I’m afraid
DMPHL, they would be recognizing revenue on their income statement not balance sheet. Let's not anger the mighty accountants too much.
Maybe Al Baker wants to personally inspect each plane.
Better not tell Greta...
Hope they at least used it for pilot training!
”Instead the planes have flown 15,630 miles each, over 16x the necessary distance, with each plane flying for about 30 hours. When you multiply that by seven planes, that’s a lot of emissions.“
Wow. The pandering in this statement is mind boggling. And completely hypocritical despite the lengths you’ll go to, to convince yourself otherwise.
Boeing has been underperforming Year over Year in terms of Revenue every quarter. Their Fiscal Year End is 12/31, I am sure Boeing even helped Qatar pay for the flights in some way just to be able to book the revenue this Fiscal Year.
There must be some specific legal reasons on QR's end that require delivery flights be to Doha. It might be as simple as in order for them legally to take possession of a foreign asset like an airplane, it needs to happen IN Qatar. A guess, as I'm not a Qatari lawyer. But I doubt, as @Lucky states, that it is just poor planning on QR's part.
And, yes, Boeing likely needed to deliver the...
There must be some specific legal reasons on QR's end that require delivery flights be to Doha. It might be as simple as in order for them legally to take possession of a foreign asset like an airplane, it needs to happen IN Qatar. A guess, as I'm not a Qatari lawyer. But I doubt, as @Lucky states, that it is just poor planning on QR's part.
And, yes, Boeing likely needed to deliver the planes in order to realize the revenue on its balance sheet. At list price that's $2B+ (and with discounts probably not substantially less) in revenue that they definitely need on their 2019 balance sheet.
To recognize the revenue BA would have to deliver them, not just send them to the next step in the manufacturing process.
Unfortunately it is likely a tax law that requires the plane to be delivered to its country of registration. I’d put this blame squarely on the US government.
@Dennis - exactly. Accountants 'win' (they think) again
Of course qatar doesn't care about the impact on environment. The country is one of the highest emission generators in the world per capita terms...
And this is why I don't believe any company's "green" policies, or pay extra for "carbon offset". Combination of bureaucracy gone mad and idiotic execution.
My guess it’s related to Boeing’s financial accounting
They have learned from the 24-mile-flight-bad-publicity. So instead of doing another short ferry flight again, they took the long route this time ;)