Share

Airbus jet re-launch heralds busy airshow

Farnborough - Airbus will kick off the Farnborough Airshow with up to 100 commitments for its revamped A330neo wide-body jet, industry sources said, deepening a contest with Boeing for up to $250bn of orders at the core of the long-haul jet market.

After months of speculation, the European planemaker will on Monday unveil an upgrade of its popular but ageing A330, powered by Rolls-Royce engines and offering 14% in fuel savings. Airbus Group declined to comment.

The upgraded A330 is Airbus's attempt to prolong the life of its profitable twin-aisle jet, as the European company tries to preserve market share against Boeing's much newer 787 Dreamliner.

The A330 has enjoyed a resurgence of sales because of delays in deliveries of Boeing's technically ambitious but temperamental carbon-fibre jet, but it is in need of a refresh to keep selling.

Analysts say it also plugs a potential future gap in the Airbus wide-body jet portfolio after poor sales of its A350-800 - the minnow of the next-generation A350 family whose development looks set to be halted or suspended as a result.

The commercial debut of two models called A330-800neo and A330-900neo, first reported by Reuters, heads a busy schedule of announcements on day one of the show, at which Boeing could hit back promptly with new sales of its 787 Dreamliner.

Analysts have until now generally predicted a low-key show, because of steadily growing fears of airline overcapacity.

But industry sources gathering for the July 14-20 event said evidence pointed to well over 500 orders or commitments ranging from a 100-plane lessor deal to a single plane for Fiji. It may not be immediately apparent, however, how many orders are new.

Malaysia's AirAsiaX has campaigned for an A330neo to save on fuel bills but is seen likely to exchange any new order against at least part of its 38 outstanding current-generation A330s.

Boeing begins the week with a clear advantage after gaining 703 gross orders up to July 8, or 649 after cancellations, against Airbus's end-June total of 515 gross orders and 290 net.

Sales drive

Executives from across the world suspended preparations for the show to watch the World Cup final on Sunday, some of them puzzled by 90 minutes of uncompromising deadlock. But their own week-long contest starting on Monday was likely to be full of fireworks.

After an intense sales drive in recent weeks, Airbus is expected to outpace its US rival by about two to one at the air show - but not without losing a shoot-out on prices.

Boeing's newest customer, UK airline Monarch Airlines, looks set to confirm it defected from Airbus after a tough competition for 30 jets worth some $3bn, first reported by Reuters.

Qatar Airways may finalise a $19bn order for 50 Boeing 777-9X 406-seat airliners and place an order for 25 or more Airbus A320-family aircraft, industry sources said.

Boeing will also be hoping to secure a long-awaited order for its 737 MAX from lessor ILFC, recently acquired by Dutch lessor AerCap, which may also order 50 Airbus A321 aircraft.

Other major leasing companies such as Air Lease Corp , CIT Leasing, BOC Aviation and others are shopping this week, industry sources said.

Doubts over the future of the A350-800 have meanwhile left Airbus with the problem of converting 34 remaining orders.

Hawaiian Airlines, until now seen as an obstacle to the change, told Reuters last week it would look at the A330neo.

But Aeroflot, which has eight on order, remained non-committal.

"Concerning the A330-neo, we know about this aircraft ... We are researching and we will see what happens," chief executive Vitaly Savelyev told Reuters.

The 250-300 seat market is the largest segment of the wide-body jet market by volume and represents 4 520 aircraft worth more than $1trn over the next 20 years, according to Boeing's latest market forecast, published last week.

Airbus believes its A330neo series can achieve at least 1 000 of those orders, but Boeing says the market opportunity is closer to 400 planes and even then, only for a short period.

Still, the cheaper A330neo is expected to spark increased price competition for small wide-body jets.

"The A330neo could potentially offer the right mix of fuel-burn reduction and lower acquisition cost ... Less clear is whether the economics and timing will be sufficient to sway customers from the 787 this time," said Rob Morris, head of consultancy at Flightglobal Ascend, in a report being published at the show.

Visitors hoping to see the star attraction of the defence side of the show, the Lockheed Martin F-35, were disappointed when organizers said it would miss its debut on Monday. America's newest combat jet, grounded after an engine fire, could appear by the end of the week.

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.94
-0.2%
Rand - Pound
23.91
-0.1%
Rand - Euro
20.43
+0.2%
Rand - Aus dollar
12.34
+0.1%
Rand - Yen
0.13
-0.2%
Platinum
910.50
+1.5%
Palladium
1,011.50
+1.0%
Gold
2,221.35
+1.2%
Silver
24.87
+0.9%
Brent Crude
86.09
-0.2%
Top 40
68,346
+1.0%
All Share
74,536
+0.8%
Resource 10
57,251
+2.8%
Industrial 25
103,936
+0.6%
Financial 15
16,502
-0.1%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders