US embassy cable - 04AMMAN7337

C O N F I D E N T I A L AMMAN 007337 
 
SIPDIS 
 
USDOC 4520/ITA/MAC/ONE/PTHANOS 
DEPARTMENT FOR EB FOR WAYNE/MERMOUD 
 
E.O. 12958: DECL: 08/31/2014 
TAGS: EAIR, BEXP, JO, IZ 
SUBJECT: RJ WILL LEASE AIRBUS, BUT KING REITERATES 
COMMITMENT TO A BOEING DEAL 
 
REF: AMMAN 6587 
 
Classified By: Charge d'Affaires David Hale for reason 1.5(b) 
 
1. (C) An August 31 article in Al-Rai, a daily generally 
regarded as an official mouthpiece, cited an unidentified 
government official as stating that Royal Jordanian Airlines 
would announce, at its September 1 board meeting, its 
decision to acquire ten Airbus aircraft.  Samer Majali, in a 
conversation later that day with a Boeing agent, claimed to 
have been surprised by the article and to have had no 
knowledge that a final decision had been made in favor of 
Airbus, saying that RJ had recently hired a consultant to 
perform a study reviewing the relative merits of the 
proffered Boeing and Airbus deals prior to making a new 
decision 
 
2. (C) Following up an inquiry by Charge, Royal Court 
Minister Samir al-Rifai informed him late on August 31 that 
RJ would indeed announce a decision to lease Airbus aircraft. 
However, he said that the King, who was aware of the text of 
Boeing Senior Vice President Tom Pickering's August 30 
letter, wanted us to know he remained committed to the 
purchase of five Boeing aircraft by RJ or its subsidiary 
Royal Wings if financing arrangements are made along the 
lines of his previous discussions with Boeing. 
 
3. (C) COMMENT: The rapidity with which the GOJ has moved to 
publicize its decision to go with Airbus after the expiry on 
August 31 of its period of negotiation with Boeing is 
striking, and seems hard to explain on the strict basis of 
commercial considerations.  Episodes illustrating Majali's 
marginalization from decision-making on this purchase 
continue to pile up, as the Palace's role becomes 
progressively more overt.  Difficult and expensive though it 
might be for RJ to run a mixed fleet, this does not appear to 
have been the primary driver of this decision. 
 
4. (C) The ball has been put in Boeing's court to address the 
financing gap in their projected deal - and Pickering expects 
to have answers by mid-September.  Based on Post's 
consultations with Pickering, we see no immediate need for 
USG action, other than continual reminders of our interest 
when senior officials meet.  In connection with Boeing, we 
may wish to consider a SecState-King letter, to be delivered 
simultaneously with what may be Boeing's final offer in 
mid-September.  END COMMENT. 
HALE