Trader pays $34,000 for Dreamliner flight

787 DREAMLINER An All Nippon Airways Boeing 787 lands after its inaugural commercial flight from Japan, at Hong Kong International Airport on Wednesday, Oct. 26, 2011. The jet, nicknamed The Dreamliner by Boeing Corp., was flown by Japan's All Nippon Airways and was packed with aviation reporters and enthusiasts — some of whom paid thousands of dollars for the privilege. AP Photo/Vincent Yu

HONG KONG—Boeing’s 787 Dreamliner on Wednesday flew its first paying passengers from Tokyo to Hong Kong, showing off a lighter carbon-composite design that is more economical to fly and more comfortable than its metal rivals currently plying the airways.

Flown by Japan’s All Nippon Airways (ANA), Boeing’s newest jet was packed with corporate VIPS, journalists and enthusiasts, including an American businessman who paid $34,000 for a chance to fly into history on what was touted as an aviation breakthrough.

Four hours and eight minutes after a delayed takeoff from Tokyo, the twin-engine jet landed in Hong Kong on Wednesday afternoon.

Wearing traditional Japanese jackets, ANA chief Shinichiro Ito and Boeing vice president Scott Fancher broke open barrels of sake with small hammers and handed the rice wine to passengers before they all embarked at Narita.

Miami businessman wins

ANA, the Dreamliner’s launch airline, auctioned six business-class seats on the inaugural flight, with one selling for $34,000—around 13 times the price of a regular business-class ticket between Tokyo and Hong Kong.

The winner of the eBay auction was 48-year-old Miami businessman Gino Bertuccio who, according to the Wall Street Journal, had mistyped his maximum bid amount but was nevertheless enthralled at being on the flight.

The newspaper said another delighted passenger was Thomas Lee, a 59-year-old California executive who flew on the maiden commercial flights of the Boeing 747 in 1970 and the Airbus A380 superjumbo in 2007.

ANA also sold 100 economy-class seats as part of a tour package including one night at a hotel in Hong Kong for $1,000 per adult.

Touting the 787’s green credentials, ANA said proceeds from the online auction would go to international environmental groups.

Delayed delivery

Painted in the blue and white ANA livery with red highlights, the first Dreamliner was delivered on September 28, three years after it was originally promised to the airline.

Production delays and technical mishaps cost US-based Boeing Corp. billions of dollars in lost or canceled orders, giving an edge to its fierce European rival, Airbus.

But Ito, the ANA president, who traveled on the 330-seat jet from the United States after receiving the aircraft from Boeing, declared himself “delighted” with the aircraft’s touchdown in Tokyo last month.

Boeing’s technological flagship is a little faster than the 707, the first commercial jet it had built more than half a century ago. Even so, ANA is just fine with the idea of delivering its passengers in same amount of time they always have.

Cheaper, happier

ANA wants to get passengers to their destinations cheaper and happier—a formula that other carriers see as the key to surviving in a cutthroat global air travel market rattled by the rise of budget carriers.

“For carriers with high operating margins, the 787 is critical in gaining a cost competitiveness,” said Masaharu Hirokane, an analyst at Nomura Holding in Tokyo. “For ANA to be a launch customer is a plus.”

The Dreamliner was originally conceived in 2001 as the “Sonic Cruiser,” designed for a bygone era of aviation that quickly morphed into one filled with bankruptcies and soaring fuel costs. It was a design that promised the first serious speed increase since the advent of the now defunct Concorde.

Most jetliners cruise at around eight-tenths the speed of sound. The Sonic Cruiser promised mach 0.98, lopping hours off long-haul flights between Tokyo and New York. The apparent end of cheap oil, with prices close to $100 a barrel, forced Boeing and other airlines to change course.

Thus was born the Dreamliner.

With Boeing’s rival, Airbus, also focused on lowering its cost-per-passenger mile, the prospects for more speed any time soon are dim.

ANA is planning to use the 787 on its regular flights to Beijing and Frankfurt, as well as Hong Kong.

Fuel efficient

Boeing says the twin-aisle 787’s construction, partly from lightweight composite materials, means the jet consumes 20-percent less fuel than comparable planes, an attractive proposition for airlines facing soaring fuel costs.

The Chicago-based aerospace and defense giant has also been touting the larger windows, bigger luggage storage bins and greater cabin humidity than conventional jets, a factor it says will reduce traveler fatigue.

Boeing is hoping the Dreamliner will be a hit with passengers who want more nonstop travel, and the company says the 787 is already the fastest-selling twin-aisle airplane in aviation history, with more than 800 orders since 2004.

With an average list price of $202 million, the Dreamliner is the firm’s first new design in more than a decade.

The aircraft’s success or failure will depend much on Japan, the only major aviation market where Boeing clearly dominates its European rival.

More than a third of the Dreamliner is built by Japanese companies, including Mitsubishi Heavy Industries, Kawasaki Heavy Industries and Fuji Heavy Industries.

Of Boeing’s backlog of 821 orders for the Dreamliner, nearly a tenth of them are from Japan.

Welcome commitment

ANA expects its 55 aircraft by March 2018 and has so far stuck with Boeing despite three years of delays.

That is a welcome commitment for Boeing after China Eastern Airlines on October 17 terminated an order for 24 Dreamliners rather than wait for production to pick up speed.

Air New Zealand last week voiced concerns over possible further delays. The carrier said it was seeking compensation from Boeing.

The plane builder on September 26 said it expected to break even on the plane this decade. Boeing is scheduled to release its latest earnings results in the United States on Wednesday. Reports from AFP and Reuters

Originally posted at 07:07 pm | Wednesday, October 26, 2011