GRPS 640
RIORITY
RE REGIST
0.
YPHER/CAT A
- 6 FEB 1974
4212 21112
FM HONG KONG 040258Z
CONFIDENTIAL
CONFIDENTIAL
Rayy this is arot fes
(3)
MTD hoe SX to AKIOD) With Coping to 573
TO PRIORITY DT I TELNO ALLOT U/N OF 4TH FEBRUARY, 1974.
YOUR TELNO ALLOT 12:
CPA PURCHASE OF WIDE BODIED AIRCRAFT.
LAST
REF.
NEXT
REF
1 ASKED ADRIAN SWIRE AND JOHN BROWN OF THE LONDON OFFICE,
AND BREMBRIDGE TO CALL.
2. AS THEY PUT IT TO ME THEIR DECISION HAD BEEN. TAKEN WITH
GREAT RELUCTANCE, BUT AFTER VERY CAREFUL BALANCING OF ALL THE MANY
FACTORS INVOLVED. I AM RELUCTANT TO COMMENT ON SUCH A HIGHLY
TECHNICAL SUBJECT IN WHICH OVER-SIMPLIFICATION CAN OBVIOUSLY BE
EXTREMELY MISLEADING. BUT SUBJECT TO THIS RESERVE MY IMPRESSION
WAS THAT THE CONSIDERATIONS WERE NOT SO MUCH PRICE OR FINANCIAL
TERMS (I GATHER THE DC 10 IS MARGINALLY DEARER THAN TRI STAR) BUT A MIX OF OTHER FACTORS, INCLUDING LOCAL CONDITIONS.
3.
OF THESE OTHER FACTORS IT MIGHT BE SIGNIFICANT THAT THEY KEPT
RETURNING TO :
(^)
WORRIES ABOUT THE FINANCIAL MUSCLE OF THE COMMERCIAL DIVISION
OF LOCKHEED WHICH REFLECTED
1) ON THE COMPANY'S WILLINGNESS OR ABILITY TO COMMIT THE NECESSARY RESOURCES TO CORRECT ANY FAULTS IN TRI STAR THAT
MIGHT EMERGE, AND EVEN
(11) ON THE FUTURE OF THE COMMERCIAL DIVISON ITSELF.
(B) THE DC 10 WAS ALREADY AVAILABLE IN THREE MARKS INCLUDING A
STRETCHED VERSION AND THEREFORE OFFERED ASSURED DEVELOPMENT
PROSPECTS TO THE OPERATOR.
4.
CATHAY PACIFIC DO NOT NORMALLY BUY NEW AIRCRAFT, AND IN THIS INSTANCCE, IT IS UNLIKELY THAT THEY WOULD PURCHASE MORE THAN TWO BUT WOULD ENDEVOUR TO EXPAND THEIR FLEET BY SECONDHAND PURCHASES.
THE POTENTIAL ORDER MAY THEREFORE NOT BE AS SIGNIFICANT AS THE
COMPANY'S REQUIREMENT FOR EIGHT OR TEN WIDE-BODIED AIRCRAFT MIGHT
SUGGEST.
15/1
150
CONFIDENTIAL