Airbus Wins British Airways Order

British Airways said Monday that it plans to buy 12 new Airbus Industrie A-318 jetliners to replace some of its older Boeing planes on short-haul routes, a blow to Boeing Co., which had hoped to win a high-profile customer for its new 717 jetliner.

British Airways, which also took options to buy another 12 A-318s, said it chose the European consortium’s 100-passenger jet “for its superior economics, flexibility and commonality with the rest of our short-haul fleet.”

The airline will pay $412 million for the first 12 planes.

Boeing had sought the order as a major-airline endorsement of its 106-seat 717, the first of which was delivered last month to AirTran Airlines.

Boeing inherited the 717--then called the MD-90--from McDonnell Douglas when the companies merged two years ago. There has been speculation that Boeing will discontinue the plane, as it has other McDonnell Douglas jetliner models, if sales do not pick up. The 717 is built in Long Beach.

Boeing has orders for 115 717s, and Hawaiian Airlines has said it plans to order 13 more. Airbus has orders and commitments for 157 of its A-318s.

Some analysts thought Boeing might have had an edge because the 717 is flying now, whereas the A-318 is three years away. The first A-318 won’t come off the production line until 2002, and British Airways will get its first aircraft in January 2003.

Also, Boeing last week agreed to buy 34 used Boeing 757s from British Airways and reconfigure them into freighters for lease to DHL Worldwide Express, a move many thought was a prelude to an order for 717s. In some instances, the new A-318s will replace 757s on British Airways routes.

“The big-brand launch customer was going to be British Airways,” said Brian O’Keefe, an analyst with Commerzbank.

“The 717 looks like it is going to be stillborn in the market, without good customers,” he added. The British Airways loss “is very bad for Boeing--it’s a big shock.”

Boeing spokesman Sean Griffin said Monday that Boeing is “absolutely committed to the [717] program and has no plans to kill it.”