Qatar Airways reconsiders Airbus order

The Qatari flag carrier deliberates over swapping to Boeing 787

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By  Barbara Cockburn Published  June 1, 2006

Qatar Airways may swap its order for 60 Airbus A350s to Boeing’s 787 Dreamliner, causing a serious blow to the European manufacturer. The airline, Airbus’s largest A350 customer, said the aircraft’s configuration coupled with a timely re-design has forced the company to assess its options. A Qatar spokesman told Aviation Business: “We are now looking at Boeing’s 787 Dreamliner. Although we signed a letter of intent last summer with Airbus to acquire the A350s, nothing has been finalised and we are in negotiations with both manufacturers.” The re-design will delay the delivery date by two years to 2012, three years after Boeing’s 787, and increase development costs by an estimated $4 billion. Although the airline signed a letter of intent for 60 twinjets for delivery from 2010 it has held off signing a contract until Airbus finalises the aircraft’s performance and specification. Confirmation by Airbus of its expected rethink would see the A330-based A350 design replaced by an all-new larger aircraft with a wider fuselage and larger wing. Thomas Enders, co-chairman of the European Aerospace, Defence and Space Company (EADS), which owns Airbus together with BAE Systems, said delivery of the aircraft would depend upon the changes. He also admitted that Airbus had made mistakes in its thinking on development of a model to compete with Boeing’s new 787 and had underestimated the Dreamliner. He said: “We’ve made mistakes. But we have to put this behind us.” The changes in the design of the aircraft caused a jump in shares last month. Shares in the EADS Company jumped by 1.19% in early trade. Orders for Boeing airliners have outnumbered those for Airbus planes by a ratio of more than three to one since the start of the year. Orders for Boeing’s 787 aircraft totalled 325 at the end of April against 99 for Airbus. In April alone, Airbus booked only nine new orders whereas Boeing concluded deals for 175 new planes. However Airbus leads in terms of deliveries. The company has delivered 142 planes since the start of the year compared with 126 for Boeing. However the European Aeronautic Defence and Space Company (EADS), the parent of planemaker Airbus SAS, posted net profits of Euro516 million, up 26% compared to the same period last year after aircraft sales increased 18%. The Airbus division grew its revenues by 28% to Eur6362 compared to the first quarter of 2005. This was as a result of aircraft deliveries which increased by 8% to Eur681 million compared to the first quarter last year. Airbus’s resources are tied up with further development of the enormous double-decker A380 which flew, last month, from the Berlin airshow to London’s Heathrow. In addition, surging fuel prices may prevent other firm orders from airlines.

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