Advisor to the Minister of Roads: The Contract with Boeing Remains Valid

Asghar Fakhrieh Kashan, the advisor to the Minister of Roads and Urban Development for international affairs, announced on Tuesday: "The contract for purchasing aircraft from Boeing remains valid and has not changed." In an interview with ILNA news agency, he attributed the postponement of the delivery of a Boeing aircraft ordered by Iran to 2019 to banking restrictions for issuing guarantees. According to the international affairs advisor to the Minister of Roads and Urban Development, although Iran Air provided the down payment for the delivery of the Boeing 777 aircraft "with a slight delay" and within the "legal deadline," the bank that was supposed to issue the guarantee for this contract "announced at the last moment that it was reviewing the guarantee issue." Asghar Fakhrieh Kashan clarified that the mentioned bank postponed the issuance of the guarantee to a date after May 22, and fundamentally did not remove the issuance of the bank guarantee from its agenda. May 22 is the date when U.S. President Donald Trump is expected to announce his country's position regarding the JCPOA. The issue of the delay in the delivery of the purchased Boeing 777 to Iran Air was raised last week. Dennis Muilenburg, CEO of Boeing, stated at a press conference: "We have no deliveries to Iran that are part of this year's production schedule, so these deliveries have been delayed according to U.S. government processes." He also emphasized that Boeing would not face issues regarding the lack of progress in the contract with Iran as per the predetermined schedule. Boeing was supposed to deliver the first aircraft, a Boeing 777, to Iran Air in May 2018, which does not seem to be feasible. If the delivery of new aircraft to Iran had gone according to plan, Iran should have received nine Airbus aircraft last year, but this did not happen, and only three Airbus aircraft were delivered to Iran. Previously, Gholamreza Salami, an advisor to the Minister of Roads and Urban Development for accounting affairs, stated in an interview with Shargh newspaper that due to "problems arising from sanctions, financial issues of the government, and some bureaucratic matters," Iran has been unable to fulfill its obligations to Boeing, causing delays in the delivery of aircraft that were supposed to be sold to Iran this year. "The lack of ability to transfer money, financing, and leasing" were among the factors mentioned in the advisor's conversation with Shargh as reasons for the non-implementation of aircraft purchase contracts from Airbus and Boeing, although Gholamreza Salami emphasized that "there has always been a hostile atmosphere regarding the purchase of these aircraft, which is not without effect in the current situation." According to the advisor to the Minister of Roads and Urban Development, "When there is no consensus, we do not reach a desirable result." However, another advisor to the Minister of Roads, Asghar Fakhrieh Kashan, mentioned in his interview with ILNA on Tuesday that they are negotiating again with Boeing and stated: "Now that Boeing has not received the down payment at the scheduled time, we must negotiate for later payment and delivery dates and set a new date." The former deputy minister of roads and urban development believes that "nothing special has happened that some people have created such a fuss about." He also emphasized that "the occurrence of all these conditions in the contracts for purchasing new aircraft from Airbus, Boeing, and ATR has been anticipated, and with the return of sanctions, not a single rial of Iran's money in these contracts will be wasted." Based on negotiations between Iranian airlines and Western aircraft manufacturers, Iran Air has ordered 100 aircraft from Airbus, of which three have been delivered. Boeing has also committed to sell 80 aircraft to Iran Air and 30 aircraft to Aseman Airlines, valued at over $20 billion. Additionally, 10 Boeing aircraft have been ordered for Qeshm Air. Of these 120 aircraft, 90 are Boeing 737 models, with 50 for Iran Air, 30 for Aseman, and 10 for Qeshm Air. Another 30 aircraft are Boeing 777 for Iran Air. After Donald Trump's election as President of the United States and his administration's opposition to the JCPOA, problems have arisen regarding the implementation of these contracts. On the other hand, last Wednesday, April 24, the two airlines "Aseman" and "Iran Air Tour" signed a memorandum of understanding with the Russian company for the purchase of forty Sukhoi Superjet 100 passenger aircraft. It seems that while the status of the nuclear agreement is uncertain and it is likely that Airbus and Boeing will not be able to deliver the agreed aircraft to Iran for various reasons, these two companies have turned to Russian companies for aircraft purchases and the renewal of Iran's aging air fleet.