Airbus says medium-haul jet demand to help offset economic downturn

Monday, 22 August 2011 00:31 - - {{hitsCtrl.values.hits}}

Reuters: European planemaker Airbus expects aircraft production to be flat or slightly higher in the event of another global economic downturn as growing demand for medium-haul jets in Asia helps it keep the pressure on rival Boeing.

Airbus’ sales chief John Leahy warned on Tuesday a new recession was a possibility but said if that happened the aircraft manufacturer would manage its order book in a similar fashion to 2008-2010 when deliveries were shifted around to meet changes in demand.

“I would not be surprised to see some weakness in the economy. I’m not sure it is back to 2008 but I think a double-dip recession is definitely a possibility,” Leahy told reporters by telephone in Sydney when asked about the global economic outlook.

“I think Airbus will keep the production at least flat if not increasing during this period because of such demand from places like Asia, India and lower-cost carriers around the world.”

Australia’s Qantas Airways announced a firm order for up to 110 Airbus’ A320 jets, including 78 A320neos, with a total value at list prices of $9.4 billion. Qantas also has rights and options for another 194 aircraft. The deal brings sales of its A320neo, a similar model to a re-engineered Boeing 737 due to be equipped with fuel-saving engines, to around 1,200 and highlights Airbus’ growing lead over Boeing in medium-haul jets.

“I would not like to gloat but I tend to think we have (shut Boeing out of some markets). It is not just the first mover advantage, I think we also have a better product,” Leahy, Airbus Chief Operating Officer, Customers, said.

However, Leahy denied speculation that Airbus was in negotiations on plane orders with Southwest Airlines Co, which currently only owns Boeing 737s.

“That (speculation) got out of hand. The rumours we were in negotiations with them were just wrong,” he said.

American Airlines last month split a giant $40 billion order for single-aisle jets between Airbus and Boeing, breaking off an exclusive relationship with Boeing.

As part of the deal announced Tuesday, Qantas said it would delay the delivery of six Airbus A380 aircraft on order by up to six years. Qantas is also facing delays in the delivery of Boeing 787 aircraft.