TNAG-0964-FCO40-1183-Air-services-between-the-UK-and-Hong-Kong-1980 — Page 167

CONFLAM

M. Willampen

This explains part of

The story purschares

ovis

CPA IS

1. Mw Clift

Zrichiam

2. Mr Morze ov. 3. PA

DEPARTMENT OF TRADE

8.4

SHELL MEX HOUSE STRAND

Anne Stoddart

MAED 3/4/80.

Vory uberesty and revealing

deresting

A Warrington Esq

Air Division

Department of Industry

Monsanto House

London SW1

Dear

CATHAY PACIFIC AIRWAYS:

LONDON WC2R 0DP Telephone Direct Line 01-217 4524

Switchboard 01-217 3000

22 March 1978

Mr Maynas / the (I have replent)

ENGINES FOR THE B747

пре

ал

29/3

I think it may be useful if I summarise for the record the events that led up to Cathay Pacific's recently published decision to fit the B747 aircraft, which they now have on order, with Rolls- Royce engines rather than with the competing engines which were offered by General Electric and Pratt and Whitney in the United States.

Although I did not mention it in my letter of 26 January 1978, at our talk over the lunch table on 24 January Donald Pepper and his colleagues asked whether we could encourage CPA to buy the longer range Tristar rather than the B747 or DC10 but I declined to be drawn. We had of course been aware of CPA's agoni sing over their future equipment needs and it never seemed really likely that the Tristar would be the answer. We did not think it would therefore be useful for us to intervene. However, once CPA came down firmly in favour of the B747, I wrote to John Browne on 2 February 1978 and copied that letter to you.

Subsequently, we were kept informed orally of the progress of the competition between the three engine manufacturers for what all of them regarded as an order of first rate importance and were aware of the factors that Cathay Pacific had in mind.

When I visited Hong Kong at the beginning of this month CPA's studies were almost complete. The pros and cons were fairly evenly balanced, and it looked as if the deciding factor would be the likelihood that all the other neighbouring airlines in the Orient would buy one or other of the American engines. A decision by Cathay Pacific to go along with the tide would therefore not only have been to their own advantage but would also have helped their associated engineering company in Hong Kong (HAECO) to get work on the maintenance and overhaul of other airlines' engines.

/I therefore