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Airbus increases 2008 sales target as orders flow. Another B787 delay looms?

  • Airbus upgrades sales target to “at least 750” aircraft following strong first quarter;
  • Huge order backlog means global financial crisis is “not of big concern”;
  • Strong leasing market and demand for aircraft slots by Asia Pacific and Middle East airlines means any cancelled orders would be taken up quickly.
  • Boeing could be preparing to announce third delay to B787 deliveries;
  • Air New Zealand believes delivery delays are “probably a good thing” for the airline industry.

Airbus COO, John Leahy, has upgraded the manufacturer’s sales target for 2008 from 700 aircraft to “at least 750”, following a very strong first quarter, in which it booked 395 net orders.

Airbus President and CEO, in Sydney with Mr Leahy to pitch the A350XWB-1000 to Qantas as a rival to the B787-10, stated that while Airbus is “concerned” by the global financial crisis, in which he expected to see some cancelled orders, “if you look at our [order] backlog, it is not of big concern”.

Airlines cancelled 25 Airbus aircraft in the first quarter of 2008, including 12 A318s, three A350XWB-800s and ten A350XWB-900s, although customers were not identified.

Airbus is also unconcerned by the recent failure of US LCC, Skybus, whose A320 production slots for 2008 and 2009 are controlled by lessor, BOC Aviation. Mr Leahy pointed to a strong leasing market and demand for A320 slots by other carriers, including several Asia Pacific and Middle East LCCs, and he expects Skybus’ slots to be taken up quickly.

Of the 395 net orders received by Airbus in the first quarter of 2008, 76%, or 302 units, were for narrowbody A320-family aircraft.

Airbus outsold Boeing in the first quarter, with the US manufacturer gaining 288 new orders in the period. Boeing is also preparing to announce this week what is expected to be a third delay to the B787 programme. The manufacturer previously stated it would announce a new delivery schedule either early this month or on 23-Apr-08, when it reports first-quarter earnings.

Decisions by several Asia Pacific airlines on widebody replacement and expansion plans are imminent and will be extremely competitive. Qantas, for example, is expected to decide within months which of the two aircraft it will choose as a replacement for its 30-strong fleet of B747s, which are due to retire by mid next decade.

Meanwhile, Air New Zealand CEO, Rob Fyfe, last week stated aircraft delivery delays are “probably a good thing” for the airline industry, helping to defer capacity growth, which supports industry earnings.

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