AIRBUS HAS won a potential $4.2 billion (€3.4 billion) order for its A350 passenger jet, its first major deal at a subdued Farnborough Airshow, where a faltering global economy is casting clouds as dark as the skies over southern Britain.
The deal announced yesterday with Hong Kong airline Cathay Pacific is a major boost for the European plane maker, which has been struggling to sell its A350-1000 “mini-jumbo” and make a dent in Boeing’s hold on the lucrative corner of the passenger jet market, just below 400 seats.
Boeing itself announced a provisional deal to sell 100 next-generation narrow-body 737 airliners to leasing firm Gecas. They are worth around $9.3 billion (€7.59 billion) at list prices. That was the US group’s second big deal for the revamped plane in as many days, bolstering its fightback against Airbus’s A320neo in the top-selling short-haul segment of the market.
Both deals, however, were well flagged in advance of the show, where there have so far been no major surprises.
Boeing and Airbus, which battle for the bulk of a market estimated at $100 billion (€81.5 billion) a year, played down expectations ahead of the aerospace industry’s showcase gathering, arguing their order books were already bulging.
Despite stuttering economies, they say demand remains strong as airlines modernise fleets to survive high fuel costs and the balance of growth shifts towards Asia, with Boeing raising its long-term industry forecasts last week.
Airbus sales chief John Leahy was in typically combative and upbeat form: “The party’s over? Why, it’s only the second day of the show, for heavens’ sake,” he said of suggestions orders were drying up. “We’re looking at six to seven years worth of production running flat out if we don’t sell anything for the next six or seven years.”
However, some analysts say the euro zone debt crisis and slowing economic growth in China could see existing orders delayed or cancelled, and that some recent deals suggest Airbus and Boeing are heading into a price war.
Analysts predict the week will produce a combined 300-400 orders for Airbus and Boeing, less than half the number at the equivalent annual show at Paris last year.
Airbus said Cathay Pacific planned to buy 10 new A350-1000 aircraft, worth around $3.2 billion (€2.61 billion) at list prices. It also converted an existing order for 16 A350-900 jets to the larger model, adding a further $1 billion (€816 million) to the possible new income from the day’s signing.
Boeing said Gecas had committed to buy 75 of its 737 MAX 8 planes as well as 25 of its next-generation 737-800. That deal leaves Boeing well ahead of Airbus in terms of orders at the show.
– (Reuters)
