Boeing earns chump change from selling aircraft parts to Iran

Business Materials 6 May 2015 12:13 (UTC +04:00)

Baku, Azerbaijan, May 6

By Umid Niayesh - Trend:

Selling aircraft parts to the Islamic Republic has brought as low as $27,000 worth of profit to Boeing, since Tehran and the six world powers signed an interim nuclear deal last year, an official with the US aircraft manufacturing company told Trend May 6.

Under the deal which came in to force on Jan. 20, 2014, the P5+1( the US, France, the UK, Russia, China and Germany) undertook to provide Iran with some sanctions relief in exchange for Tehran agreeing to limit certain aspects of its nuclear activities.

Following the deal Tehran was allowed limited purchases of only aircraft parts and repairs, but not aircrafts.

In July 2014 Boeing struck a deal with Iran Air to provide plane parts to the country's flag carrier, the first time the US firm was doing business with Iran since the US embargo of 1979.

The giant US aircraft manufacturing company has sold one part and numerous manuals, navigation charts and other materials totaling $310,000 in revenue, generating a total profit of $27,000 by the end of 2014, Tim Neale, who leads communications for Boeing Washington, DC office, told Trend.

"We reported no transactions for the first quarter of this year," Neale said. "Any future transactions that occur going forward will be reported at the end of the second quarter (end of June), that is the requirement under which we are working," Neale said while responding to a question whether the signed agreements with Iran are in force.

He further said that the company's current license permits only the sale of parts and information related to safety of flight.
The license expires at the end of June, Neale said, adding it will be the US government's decision as to whether it is extended beyond that date.
While commenting on the company's possible studies over Iran's aviation market he said that the company is not speculating on business opportunities that might arise, if any, should sanctions be lifted further.

It should be noted that Iran and the P5+1 reached a nuclear framework agreement on April 2 in Lausanne that raised hopes for achieving a comprehensive nuclear deal by June 30.

The deal provisions the removal of all international sanctions on Iran and in return narrowing the range of the country's nuclear activities.

The US-led sanctions on aircraft and spare parts exports to Iran have left the Iranian airlines saddled with not only some of the oldest fleet in the Middle East, but in the world.
Last year, Ali Reza Jahangirian, head of Iran's Civil Aviation Organization said the country's airliners would need to order 400 aircraft over the next 10 years to replace its depleting and ageing fleet.

Out of Iran's 250 commercial planes, about 150 were flying while the rest are "not functional" due to a lack of spare parts, the Iranian official said at the time.

Iran's four largest carriers - Iran Air, Aseman Airlines, Mahan Air and Iran Air Tours - all have average fleet age above 22 years, according to the Iranian media outlets.

While Iran has attempted to kick start its own commercial aviation manufacturing industry and has also sourced aircraft from Russia and Ukraine, its efforts to acquire Western-made aircraft and spare parts have largely failed due to sanctions.


Umid Niayesh is Trend Agency's staff journalist, follow him on Twitter: @UmidNiayesh