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. Last Updated: 07/27/2016

Aeroflot Loses Slots for 787 Jets

Aeroflot lost production slots for 22 Boeing 787 planes because the government has yet to approve a proposed order, which may lead to higher prices and longer delivery times.

"The original conditions on the contract have expired,'' Aeroflot Deputy CEO Lev Koshlyakov said Friday. "We will now be looking for other alternatives. We remain in contact with Boeing.''

State-controlled Aeroflot has considered ordering 787s or Airbus' proposed competitor, the A350, for more than one year. The airline's board on Sept. 15 postponed a decision on placing an order, which executives earlier that month said might total 44 aircraft in a contract split between Boeing and Airbus.

Alexander Lebedev, the owner of 30 percent of Aeroflot, signed an agreement with Boeing to reserve production times for the 787 to gain more time for the airline's board to confirm the order. The reservation accord, signed with Lebedev's National Reserve holding company on behalf of Aeroflot, expired Nov. 1.

"The agreement has expired, and Boeing gave us back the $40 million down payment,'' National Reserve CEO Anatoly Danilitsky said.

"Even if Aeroflot later decides to buy Boeing, it will be at higher prices and different time slots. The deal will have to be negotiated practically from scratch."

Danilitsky said the issue of buying Boeing aircraft was not even brought up at Aeroflot's board meeting Oct. 25. The meeting also failed to decide on additional lease of three Boeing 767 airplanes.

"If the government chooses in favor of Airbus, we will be taking Airbus,'' he said.

Aeroflot's Koshlyakov said "the issue on the contract with Boeing is not closed.''

Boeing, the world's No. 2 manufacturer of commercial aircraft after Airbus, had 455 orders for the 210- to 330-seat plane as of Oct. 26. The model, which is scheduled to enter commercial service in 2008, has a list price of $138 million to $188 million.

"We will never stop working with Aeroflot,'' Boeing Russia president Sergei Kravchenko said, declining to elaborate.

Danilitsky said separately that National Reserve's Alpstream subsidiary, a Zurich-based investment company, more than one week ago signed a contract with Airbus for the delivery of 22 A320 and A321 airliners beginning in 2009. The airplanes will be operated by Blue Wings, a German low-cost carrier 48 percent owned by Alpstream.