Airbus Books $14 Billion Deal With Air Arabia -- Update
By Benjamin Katz
DUBAI -- Airbus SE booked a $14 billion order for its
single-aisle A320neo, underscoring the disadvantage American plane
maker Boeing Co. is facing for orders amid an eight-month grounding
of the 737 MAX.
The deal from Air Arabia, for 120 A320neos, follows similar
narrow-body wins -- including a 100-jet deal from Spirit Airlines
and a 300-jet order from India's Indigo -- for Airbus in recent
The Air Arabia order was announced at the biennial international
air show here. The deal's dollar value is based on list prices and
doesn't include normal discounts.
Boeing, for its part, booked an order for 10 MAX jets from
Turkey's SunExpress. That number, though small, is important for
the manufacturer at a time when the aircraft still requires
regulatory certification to resume flights.
MAX sales have stalled since the grounding, with the notable
exception of a surprise, preliminary deal with British Airways
owner International Consolidated Airlines Group SA made at the
Paris Air Show in June. That deal, for 200 aircraft, has yet to be
completed, but was seen as a vote of confidence for Boeing.
Complicating its ability to capitalize on its rival's troubles,
Toulouse, France-based Airbus has been suffering production issues
that forced it to lower its delivery guidance for the year last
month, making Airbus suppliers wary of attempts to further scale up
output to meet demand.
"There are customers expressing their frustration" with the MAX
delays, said Airbus Chief Executive Guillaume Faury. Airbus
production slots for the A320neo are full until 2024, he said,
which is when the first of the new Air Arabia models will be
"I don't want to comment on what's happening on the other side
of the Atlantic, but basically it contributes to the lack of
capacity," said Mr. Faury. "We are under pressure because of this
lack of capacity."
In a further blow to Boeing, the chairman of its biggest
customer for the MAX in the Middle East -- low-cost carrier
Flydubai -- told reporters he could switch to the Airbus A320.
Sheikh Ahmed bin Saeed Al Maktoum, who is also CEO of long-haul
giant Emirates Airline, stopped short of saying he was leaning that
way. He said he was on good terms with Boeing. Boeing declined to
comment on Sheikh Ahmed's comments.
Boeing reiterated yesterday that it hopes to receive
certification for the MAX in December with operations able to
restart in January. The manufacturer has racked up hundreds of
undelivered aircraft as it works to get signoff for its fixes from
the Federal Aviation Administration after two fatal crashes.
Airbus also secured a $16 billion order for its A350 wide-body
jets from Emirates, a significant commitment for one of its biggest
jets but less than an earlier promise by the Mideast carrier to buy
$21 billion worth of Airbus planes.
Emirates said at the air show Monday it will take 50 A350s
instead of its initial plan for 40 A350s and 30 A330neos. Airbus
has struggled to drum up a significant backlog for the A330neo, a
rival to Boeing Co.'s 787 Dreamliner.
In a separate setback to Boeing, Abu Dhabi's Etihad Airways said
earlier on Monday that it was planning to take 20 fewer of its
aircraft than Boeing had counted on. Etihad has undertaken a
strategy overhaul and fleet review after suffering losses in the
last three years amid oil price volatility, bad investments and
(END) Dow Jones Newswires
November 18, 2019 14:14 ET (19:14 GMT)
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