Living in the United States, it’s easy to think: “United Arab Emirates? Makes no difference to me. Not even sure where it is.”
Two news stories in The National’s business section ought to make you reconsider that. One involves Boeing. The other involves Ford.
This is the story that ought to get Americans to sit up and look for the UAE on a map: “Emirates in record deal for Boeing 777s.”
Boeing is the U.S. aircraft company. One of the last big U.S. companies that actually makes things.
In this case, Emirates, the state airline of the emirate of Dubai (one of the seven emirates in the UAE) has just signed off on an $18 billion deal to buy 50 Boeing 777s. It is the biggest deal in Boeing history. Well, sure. A sum of $18 billion … that’s a lot of money, even in the aviation industry.
Emirates also has an option to buy another 20 777s for another $8 billion.
People who live in Everett, Wash., near Seattle … certainly would tell you that the UAE has made an impact in their lives — because this Emirates deal, alone, ought to keep the plant there (which makes the 777) open for a decade and be an anchor for the economy of that whole region.
(People in Southern California can tell you how important the aviation industry can be to an economy, because it’s pretty much gone there and is among the reasons SoCal is in the economic doldrums.)
Emirates is buying scads of big planes because Dubai, their base, has become a major hub for the aviation industry. Basically, you can get to anywhere from Dubai International Airport, and not many airports in the world have that kind of cachet. Paris, Heathrow, JFK, maybe Frankfurt and, now, Dubai.
If you are paying attention, you may have noticed that the Indian Ocean is an economic hot zone, and Africa is coming along, too. And if you want to get from the U.S. or Western Europe … or Japan or China … to India or Pakistan or the Gulf or anywhere in Africa, odds are good you changed planes in Dubai.
Sometime soon, even the most regular of Joes in the States will know someone who has changed planes in Dubai. And now they may know someone whose job depends on this $18 billion Boeing deal.
The second story is smaller numbers, but still significant, and also involves an important U.S. company.
Ford Motor Company seems to have regained the energy it had when it was the first great auto maker in the world, nearly a century ago. If it isn’t the best-run and most-profitable of the remaining U.S. builders, well, it’s barely behind.
From the start of the boom in the international car market, Ford was always more aggressive than Chrysler or GM. I can remember renting a tiny but quite handy Ford in England 30 years ago. Ford was already in Europe, in force.
Now, Ford is opening a $53 million parts plant in Jebel Ali, a neighborhood of Dubai.
Ford intends to become competitive in a local market that has been absolutely dominated by Japanese cars.
This may be one of those deals that would look nicer, from the perspective of the U.S., if the plant were being built near Detroit. It is not clear at all how much of Ford’s investment here might get back to the U.S.
But it shows, again, how a major American brand is doing business in the UAE.
Think of it like this: All the money you are sending to the Middle East every time you gas up your SUV … well, some of it is coming back. That’s a good thing. In the case of Boeing, a very good thing.
1 response so far ↓
1 Judy Long // Nov 16, 2011 at 4:28 PM
This is a very good piece about some all-too-rare very good business news. I may share this with my communications students; we’ve been talking about proximity, impact and other news criteria just today.
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