Boeing sees steady Gulf demand, interest in mid-sized aircraft

Boeing has seen strong regional interest in a proposed new mid-sized passenger jet, according to Marty Bentrott, vice president for Boeing’s commercial sales in the region. (Reuters)
Updated 11 November 2017
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Boeing sees steady Gulf demand, interest in mid-sized aircraft

DUBAI: Boeing sought to dispel concerns about a slowdown in the growth of Gulf airlines as the aerospace industry gathered on Saturday for the Dubai Airshow.
Speaking to reporters on the eve of the showcase event, executives at the US planemaker also played down the impact of growing political tensions in the region.
“Traffic is coming back and yields are improving and this is going to be a very positive backdrop to the Dubai Airshow,” Marty Bentrott, vice president for Boeing’s commercial sales in the region, said, citing higher profit at Dubai’s Emirates.
He said Boeing had been asked to reschedule some deliveries according to a normal pattern, but had not seen cancelations since a rift between Arab nations and Qatar earlier this year.
Boeing has seen strong regional interest in a proposed new mid-sized passenger jet, he added.


Starbucks blames slower China growth on drop in third-party delivery orders

Updated 2 min 15 sec ago
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Starbucks blames slower China growth on drop in third-party delivery orders

SINGAPORE/SHANGHAI: Starbucks Corp. has reported a sudden slowdown in China growth just weeks after trumpeting rapid expansion in the country, citing a drop-off in unapproved third-party delivery services whose bulk orders had been clogging up its cafes.
The US cafe chain on Tuesday same-store sales would be flat to slightly negative in its second-biggest market in April-June, versus 7 percent growth a year earlier. The announcement was followed by a 9 percent drop in Starbucks’ share price.
China has been a sweet spot for Starbucks for the past few years, as the country embraces cafes and opens up to drinking coffee over tea while growth saturates back home. Last month, the firm said it aimed to triple China revenue and double cafe numbers to 6,000 by 2022.
But on Tuesday, the company said new cafe openings were cannibalizing customer visits at other stores, as also happened in the United States. However, Starbucks particularly noted a decline in third-party firms — with whom it had no formal arrangements — that placed large orders for delivery to their own customers, often resulting in long in-store queues.
“I think it was driven by the government to want to stop having third parties do that because it was creating annoyances,” Chief Executive Kevin Johnson said on a call with analysts on Tuesday. He said the remedy was to seal a delivery partnership with a “large tech company” by the end of the year.
Reuters was unable to confirm any government measures on the matter.
Third-party “daigou” shopping agents in China offer services via delivery platforms such as Ele.me, backed by Alibaba Group Holding Ltd, and Meituan-Dianping, backed by Tencent Holdings Ltd. Restaurants and cafes can also have official accounts on such platforms, though Starbucks does not.
Mizuho Securities analyst Jeremy Scott in a research note said Starbucks would have been happy for the no-cost custom generated by third-party delivery services, but an official arrangement will likely push up costs.
“While the Street may be willing to forgive a tough May ... the soft comp (comparable store sales) in China is more disheartening given that management is hyper-focused on the market,” said Scott.
Starbucks also on Tuesday said it planned to close 150 cafes in the United States and open fewer locations in its financial year beginning in October, in response to competition that has seen new coffee chains, convenience stores and fast-food restaurants improve quality and cut prices.