Concorde Options and Orders

Which Airlines were interested in Concorde?

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Several of the world’s major airline companies placed non-binding orders for Concorde aircraft but most of these backed out of any agreements to go ahead with any of the orders due to several factors (the crash of one of the Soviet Union’s supersonic aircraft, worries about environmental and noise pollution and cost of purchasing and operating to craft). The only two airlines that were left were Air France and British Airways, and that was probably largely due to the fact that the two countries built that aircraft. In total, 20 Concorde’s were built and 14 flew commercially, 7 for Air France and 7 for British Airways.

The entire list of options & orders placed for Concorde by airlines, & cancellation dates

Pan Am

June 3rd 1963: - Options for 6 aircraft – 3 from Aerospatiale / 3 from BAC (2 more later optioned)

January 31st 1973: - Cancelled

July 24th 1966:- Options for 2 more aircraft – 1 from BAC & 1 from Aerospatiale

January 31st 1973:- Cancelled

Air France

June 3rd 1963: - Options for 6 aircraft

Jan.30th 1964: - Declaration of Intention from Air France to purchase 8 aircraft from Aerospatiale
July 28th 1972: - Order for 4 aircraft confirmed

BOAC (Later called British Airways)

June 3rd 1963: - Options for 6 aircraft

April 14th 1964: - Declaration of Intention from to purchase 8 aircraft from BAC
July 28th 1972: - Order for 5 aircraft confirmed

Continental

July 24th 1963: - Options for 3 aircraft from BAC

March 1973: - Cancelled

American Airlines


Oct.7th 1963: - Options for 4 aircraft from Aerospatiale

February 1973: – Cancelled

Jan.16th 1964: - Options for 2 more aircraft from Aerospatiale

February 1973: - Cancelled

TWA

Oct.16th 1963: - Options for 4 aircraft from BAC

February 1973: - Cancelled

March 30th 1964:- Options for 2 more aircraft from BAC
February 1973:- Cancelled

MEA/Air Liban

Dec.4th 1963: - Options for 2 aircraft from Aerospatiale

June 1973: - Cancelled

Jan.16th 1964: - Options for 2 more aircraft from Aerospatiale

February 1973: - Cancelled

Qantas

March 19th 1964:- Options for 4 aircraft from BAC – Options never officially cancelled.


Air India

July15th 1964:- Options for 2 aircraft from BAC
February 1975:- Cancelled

Japan Airlines

September 30th 1965:- Options for 3 aircraft from Aerospatiale

1973:- Cancelled

Sabena

December 1st 1975:- Options for 2 aircraft from Aerospatiale
February 1973:- Cancelled

Eastern Airlines

June 28th 1966: - Options for 2 aircraft from Aerospatiale
February 1973:- Cancelled

August 15th 1966:- Options for 2 more aircraft from Aerospatiale
February 1973:- Cancelled

April 28th 1967:- Options for 2 more aircraft from Aerospatiale
February 1973:- Cancelled

United Airlines

June 29th 1966:- Options for 6 aircraft from BAC
November 1972:- Cancelled

Braniff

Septenber 1st 1966:- Options for 3 aircraft from Aerospatiale
February 1973:- Cancelled

Lufthansa

February 16th 1967: - Options for 3 aircraft from Aerospatiale
April 1973:- Cancelled

Air Canada

March 1st 1967:- Options for 4 aircraft from BAC
June 1972:- Cancelled

CAAC

July 24th 1972:- Options for 2 aircraft from Aerospatiale
December 1979:- Cancelled

August 28th 1972:- Options for 1 aircraft from BAC

February 1980:- Cancelled

Iran Air

October 8th 1972:- Options for1 aircraft from BAC, orders for 2 confirmed, then cancelled.

February 1980:- All orders and options cancelled

As the British-French consortium starting pitching Concorde to other airlines, Options and orders were placed. On 8th October 1972, Iran Air itself placed an order with the British Aircraft Corporation for two Concorde, plus one option. Yes indeed, Iran intended to own a fleet of Concorde’s.

It seems from some reports that the Iranians did this to please the French, who the Iranians had close relations with (and the exiled Ayatollah also lived in France at the time).

The first Concorde was due to be delivered to Iran at the end of 1976, with the second in early 1977 and the option for the third would have been delivered in 1978. One of the production planes which had been earmarked for Iran Air was 216 (Which later became G-BOAF), and this was later handed over to British Airways for £1

Amazingly though, Iran Air did actually operate a Concorde plane for a short while, after chartering a plane for occasional flights between Paris and Tehran and Paris and Kish Island flights, but it never appeared in Iran Air Livery. The orders for the Concorde planes were cancelled in April 1980, in the wake of the Iranian Revolution, also making Iran Air the last airline to cancel its Concorde orders. Quite possibly one of those “what if” moments. If oil rich Iran had retained their orders, and helped production limp along for another couple of years through the worldwide recession, could the other airlines have come back to complete their purchases when their economies recovered? Who knows?

I can’t blame Iran for cancelling their orders, as like most airlines at the time, Iran Air was more a symbol of national identity, and the Concorde’s were most certainly toys for the Shah rather than aircraft for his people. Still, it’s a pity nonetheless.

Incidentally, Singapore Airlines also chartered Concorde’s for a few flights, as did a US firm, Braniff International Airways.

Japan Air Lines had decided to put off a decision whether or not to exercise its three Concorde options. But there were moves afoot to drop the option system for Concorde, which was tied to cut off dates. Both the British and French ambassadors to Japan at the time, called on the Japanese Foreign Minister, Masayoshi Chira, to discuss Concorde soon after Pan American dropped its options.

MEA still wanted Concorde at this time they felt that it would make a profit with first-class fares on Beirut to New York route at a load factor of 52 per cent, and that existing economy passengers—whose time was worth $25 an hour—would also pay the first-class fare. This was the view of Mr Asad Nasr, general manager of MEA—the Lebanese airline which had options since 1963 on two Concordes. MEA extended their two options, on which a £150,000 deposit was paid, from November 1973 to January 31, 1974. They stated the following at the time.”Our estimates are based on final figures given to us by the manufacturers, who are ready to sign a contract on the basis of the figures, and we ought to assume that they know what they are committing themselves to,” said Mr Nasr. Delivery of the aircraft was scheduled for October 1976 and February 1977. MEA planned to operate a “cannonball” service from New York to Beirut, making a technical, non traffic stop at Toulouse. The airline did not want to “mix it” in the London-New York market. MEA estimated a 7×2hr westbound London-Beirut service, including the stop. Mr Nasr stated that a deceleration and acceleration over France would in any case probably have to be made for boom-restriction reasons. That Toulouse would be the equivalent of Gander in the early transatlantic subsonic jet era. That was when MEA was being persuaded to buy Vanguards or Electras instead of jets. MEA still had the economic studies, and Nasr recalled the many criticisms of the jet at the time: “how it would never make money because of its fuel consumption, high operating cost and limited range.” He believed that Concorde would be similarly developed.

He stated that he had only two reservations about Concorde. He did not want to be an early operator, preferring other airlines to pioneer the type in service. And any contract with the manufacturer must have an “out-clause” in case the Americans refused Concorde permission to operate from United States airports because of its noise. Nasr noted that at the time Concorde did not meet FAR Part 36. MEA was operating a fleet of three Boeing 707-320Cs, 12 720Bs, one Comet 4C and one Caravelle 6R. On order 12 720Bs, one Comet 4C and one Caravelle 6R. On order were two 720Bs. A North Atlantic service—MEA’s first entry into this market—was planned for April 1, 1974, with 707s. A westbound flight time of l l h r 20min from Beirut non-stop is scheduled.

MEA’s Concorde philosophy was summed up by Nasr as follows: “Getting the president of an American oil company to fly to New York in eight hours instead of fourteen is something to sell. Today, what do we offer for the 40 per cent high first-class fare? A wider chair and a free whisky. To offer eight instead of fourteen hours makes it worth 40 per cent more. Passengers would not be prepared to pay 40 per cent more for the wider chair and a free drink in a subsonic aircraft when they can get there in half the time for the same fare, arrive less tired and groggy, and probably save a hotel bill equivalent to the extra fare. That is how we see Concorde. We hope and pray that it will work because it will be a great thing for MEA, and for the Lebanon.” He believed also that many people living further east would find it worthwhile to catch a Concorde from the Lebanon to New York. MEA believed that Concordes will capture all its first-class market. The big question mark, Nasr stated how many economy-class passengers would pay 40 per cent more to fly by Concorde. MEA’s conclusion is that people whose time is worth $25 an hour represent “the point of balance.” Mr Nasr said that what ‘ MEA wanted was not size but frequency.

“Frequency is speed,” he said. “A DC-3 can be six days faster than a 747.”

Since the cloth-and-piano-wire beginnings of commercial air travel, the men who run the industry had put their faith—and their money—into the forward advances of technology. Nowhere had that faith been stronger than at Pan American World Airways, which was first in the air with multi-engine planes in 1927, four-engine flying boats in 1931, Boeing 707 jets in 1958 and jumbo jets in 1970. For years, British and French aircraft builders had been counting on Pan Am to lead other airlines in a competitive scramble for the newest advance, their supersonic Concorde, which cruises at 1,350 m.p.h. But like many other people, some airline men had begun to wonder whether technology has advanced too fast, become too expensive and reached diminishing returns. So instead of leading other airlines to supersonic flight, Pan Am last inspired a retreat.

Nearly a decade after Founder Juan Trippe took options on seven Concordes, Pan Am gave word that it was cancelling out. Minutes later, Trans World Airlines released a statement that management would recommend that the directors let TWA’s six options expire. Next day in West Germany, a spokesman said that Lufthansa has no intention of picking up its three Concorde options unless the plane is drastically redesigned. It was likely also at that time to everyone that Continental Airlines will also let its three places in the Concorde production line lapse the following month, as will American with its six reservations, leaving Eastern and Braniff as the only potential takers in the U.S. Said Sir George Edwards, chairman of British Aircraft Corp., which along with France’s Aerospatiale was building the Concorde: “We should not describe this as a fatal blow, but it’s a hell of a setback.”

Together, the British and the French spent some $ 1.8 billion developing the Concorde, all of it in public funds. While the environmental groups were helping defeat the U.S. supersonic transport in 1971, the Concorde was thoroughly redesigned to minimize noise and air pollution. Still, the rejection was not a surprise. British and French technicians led by Sir George had been lobbying mightily with Pan Am executives in New York. Pan Am had lost $150 million since 1968, in the previous year, in William Sea-well’s first full year as president; losses were cut from $46 million to $29 million. Pan Am executives, understandably money-conscious, were having some serious doubts about the Concorde’s profitability. They calculated that the plane gulped two to three times as much fuel per passenger as the 747 jumbo, and that fuel prices would soar as world energy supplies dwindled. Concorde operating costs would be so exorbitant that Pan Am might have to charge a premium of as much as 20% over first-class fares, which were $888 for a round trip between New York and Paris in the high season at this time. The trip would take four hours, v. seven in a Boeing 747, but Pan Am planners feared that the time savings might not be worth the extra money to anyone but a few flush playboys and expense-account executives.

Further. Seawell had only just renegotiated a $270 million credit arrangement with Pan Am’s finicky bankers and did not want to ask for fresh financing to buy the Concorde. For each 108-to 128-passenger plane with spares. Sir George’s negotiators have been quoting a price of $46 million, as opposed to $25 million for a 747, which carried 375 passengers. Pan Am executives believed that by 1975, when they would have taken delivery, Concorde’s price would rise to as much as $60 million. The original target in 1963 was about $20 million, which climbed beyond the builders’ wildest nightmares because of inflation and man’s unfailing ability to underestimate the costs of advanced technology.

The British Aircraft and Aerospatiale needed at least 150 sales to break even. These latest dropouts left them with options of various degrees of firmness from twelve airlines for 38 Concordes. In addition, China and Iran had commitments—more definite than options, but not quite firm orders—to buy three and two planes respectively. Japan Air Lines, which had three options, would not need them now to compete supersonically against Pan Am and TWA across the Pacific; if no other airline introduces the plane on the polar route between Europe and Asia, JAL may cancel. Australia’s Qantas had a long Sydney-Singapore-London route that was well-suited to supersonic flight; it had options for four Concordes, but Qantas executives were worried that the plane could not make the 3,939-mile first leg to Singapore fully loaded. Sir George’s engineers insisted at the time that the plane had a range of 4,000 miles.

BAC felt that even if other airlines cancelled their options, Britain and France have so much pride and anguish tied up in the Concorde that production was expected to be continued, most likely at a slower rate and perhaps with fewer than the 45,000 workers. Work may have to be consolidated at one location; as engines and airframes were made at both Bristol and Toulouse. The only firm orders at this time for Concorde were from Britain’s BOAC (British Airways), which had five, and Air France, which had four. Both were owned by their governments, which may well have pressured them into take more planes. The British and French government officials may even have been angry enough to push a harder line against the U.S. at trade and tariff negotiations between American and European representatives, scheduled to begin later in the year. To the Europeans, U.S. refusal to buy the Concorde would mean the loss of hundreds of millions of dollars in export trade.

They also felt that if BOAC and Air France prove that the Concorde could be profitable, airlines that dropped their options could always take later places in the production line. Another possibility at this time was that airlines could buy the Soviet TU-144, which closely resembled Concorde and was scheduled to enter service between Moscow and Tokyo by 1975. The Soviets, were eager for hard Western currency, and had been offering astonishingly low prices and generous credit terms to potential buyers of their other planes like the YAK-40 tri-jet. Money that might have gone to buy Concordes may well go for more subsonic jumbo jets, including the McDonnell Douglas DC-10 and the Lockheed L-1011, as well as the Boeing 747. There was always the prospect of another SST at this time; the Nixon Administration’s new budget included a total of $38 million for supersonic-flight research. The Government space officials were already talking about building “the second generation” of supersonic transports, which would have been designed to be cheaper, environmentally cleaner and more profitable than Concorde.

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