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Friday, 24 June 2011

Biggest airline order in history: Airbus trounces Boeing in Paris

Planemaker Airbus celebrated a $US72 billion ($A68 billion) haul of orders, including the biggest single airliner deal in history, in a home turf victory over US rival Boeing at the Paris Air Show yesterday.
"This success sets a new record for any commercial aircraft manufacturer at any air show ever," Airbus said, after confirming Malaysia's AirAsia would buy 200 of its A320neo medium-haul jets for $US18.2 billion (12.7 billion euros).
It said this brought Airbus's order book for the week at the Le Bourget aerodrome north of Paris to 730 airliners, including 701 for its new star, the single-aisle A320 in both its original and fuel-efficient "Neo" variant.
The Airbus A320 NEO (New Engine Option) aims to extend the life of the manufacturer's bestselling model while it works on a successor. The Airbus A320neo (for New Engine Option) proved popular at the Paris International Air Show.
At catalogue prices, the orders represent hard sales worth $US44 billion and memoranda of understanding for the purchase of aircraft worth $US28.2 billion.
The AirAsia order makes the Malaysian low-cost pioneer Airbus's biggest customer and is the biggest single airliner sale by numbers in history.
Airbus chief commercial officer John Leahy also said that an unidentified firm had ordered 10 of its A380 super jumbos for $US3.75 billion dollars.
By contrast, Airbus's great rival Boeing had a relatively quiet week in Le Bourget, despite being able to show customers its ultra-modern long-haul 787 Dreamliner and the new, longer version of its iconic 747 jumbo jet.
Boeing said Thursday it had logged 142 firm orders and commitments worth more than $US22 billion during the show, most of the confirmed purchases being for the medium-haul 737, the A320's direct competitor.
The US behemoth has never used Le Bourget as a shop window in the same way as Airbus and was not expected to come out ahead.
"They choose to use their shows to make announcements, we choose to use our shows to demonstrate our technology, to connect with our customers and suppliers and to highlight our new airplanes' capabilities," said Randy Tinseth, Boeing's marketing vice-president.
But sales figures for the year as a whole to date show a stark divide. Since January, Airbus has received 725 firm orders and Boeing only 195.
The surprise key to Airbus's success has been the A320 -- an unglamorous single-aisle workhorse now available as the "Neo" or "New Engine Option" which the company boasts is 15 per cent more fuel efficient.
"I have to admit, I largely underestimated the market demand for Neo before this show," the European giant's chairman Thomas Enders said.
With world oil prices hovering around $US100 a barrel, fuel accounts for almost a third of an airline's operating costs, up from about 13 per cent in 2001, according to the International Air Transport Association (IATA).
With the world recovery in travel gathering pace, airlines and plane leasing firms are seeking to renew their fleets with more efficient planes, and the A320neo arrived at the show at just the right moment.
The medium-haul market was formerly dominated by the world's most ubiquitous airliner, the Boeing 737, now at a crossroads in its development.
The US firm has yet to decide whether to give the old favourite new engines, as Airbus has done with the A320, or to develop an entirely new airframe. It has promised to make its mind up by the end of the year.
"We continue to improve the performance of the 737," said Tinseth. "By the beginning of next year, we are going to improve the efficiency of the airplane by another two percent.
"We are leaving our options open. New engine, new airplane -- we will make the decision when the time is right."
Thursday was the last trade-only day at Le Bourget. On Friday and Saturday the deal makers will make way for tens of thousands of visitors come to see aerobatic displays and the latest planes.
AFP

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