Airbus chief upbeat in spite of Boeing challenge

Airbus chief executive Gustav Humbert says his main challenge is not so much beating Boeing in orders, as ensuring the aircraftmaker…

Airbus chief executive Gustav Humbert says his main challenge is not so much beating Boeing in orders, as ensuring the aircraftmaker can increase production and develop new models fast enough to keep pace with rebounding demand.

After some slow years, the airlines industry is shopping for new aircraft with a vengeance.

Airbus is trailing arch-rival Boeing in orders this year, but combined they are close to doubling those booked in 2004, helped by hot-selling single-aisle models and airlines shopping for more fuel-efficient aircraft.

"The challenge for Airbus is not so much the marketplace, it is to keep up with production. We are really ramping up production and development at the same time," says Humbert, speaking in an interview at the Dubai Air Show.

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According to Humbert, work ahead for Airbus includes delivering the mammoth A380 double-decker next year, developing a freighter version by 2008, the A400M military cargo plane in 2009, and the company's latest project, the mid-sized A350 due in 2010.

Asked about stretching the A380 so it could seat 1,000 passengers, Humbert says if airlines want it, Airbus will deliver.

"When we get the A380 into the marketplace, and if we see the demand there, we will do it. It is for sure one of the projects we have put on the table."

He says Boeing's plans for a new, bigger version of its long-serving 747 jumbo prove Airbus's contention that there is demand for aircraft bigger than the current 747.

"We are not surprised, we always said there was a market there. We'll now be competing for some [ sales] campaigns."

Although he is an Airbus veteran, Humbert has spent just six months as its chief executive. The appointment capped a drawn-out search that was complicated by his predecessor Noel Forgeard's forceful campaign to displace Philippe Camus as co-chief executive of parent company European Aeronautic Defence and Space (EADS).

Humbert says media speculation that a battle for power was creating factions within Airbus was unfounded: "The story was not so much about Airbus, it was about EADS."

Humbert's biggest job to date has been getting board approval for the A350, as Airbus takes aim at Boeing's 787, due in 2008.

High fuel prices have helped sales of the fuel-efficient 787 and sparked demand for the larger twin-engined Boeing 777.

According to Humbert, technology developed in the €12 billion creation of the A380 double-decker, due next year, would give the A350 an edge over the 787.

"The A350 is going to be the sistership of the A380, so it's technology you can already touch and see. It's tangible because the A380 is flying."

Each year Airbus and Boeing wage a determined battle for orders, but Humbert has stepped back from the dogfight - a task Airbus leaves to its top sales executive, John Leahy.

At the Dubai Air Show, Leahy vowed to match Boeing in orders by the end of the year, despite trailing by over 200 aircraft at the moment.

"Of course, for John it's about market share and order numbers, but as chief executive officer there are other things at least as important, such as customer satisfaction, profitability and the satisfaction of our own people," says Humbert.

"This business is like a cockpit, you can't fly using just one instrument."

According to Humbert, Airbus was happy to secure 40 to 60 per cent of the market each year. However, it will go on the offensive if Boeing tries to drive it lower.

"One per cent in profits is much more important than 1 per cent in market share," he says.

"If our rival tried to drive us down to 30 or 35 per cent, then of course we'd get very aggressive, as I expect they would."