Airbus soars on record $72 bn show sales, beating Boeing

23rd June 2011, Comments 0 comments

Planemaker Airbus celebrated a $72 billion haul of orders, including the biggest single airliner order in history, on Thursday in a home turf victory over US rival Boeing at the Paris Air Show.

"This success sets a new record for any commercial aircraft manufacturer at any air show ever," Airbus said, after confirming that Malaysia's AirAsia would buy 200 of its A320neo fuel-efficient medium-haul jets.

It said this brought Airbus' 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.

Details of the contracts were not always confirmed, but at catalogue prices the orders represent hard sales worth $44 billion (31 billion euros) and memoranda of understanding for the purchase of aircraft worth $28.2 billion.

Shares in Airbus' parent group EADS shot up 1.5 percent on the news of the AirAsia deal, despite it having been widely trailed.

French Prime Minister Francois Fillon, who made a two-hour visit to the show on Thursday, said the "remarkable" Airbus sales "prove that the economic recovery is there."

AirAsia's chief executive Tony Fernandes was on hand to announce the deal alongside the jubilant Airbus team -- striking a deal to buy a record 200 A320neo jets for a price of $18.2 billion (12.7 billion euros).

The order makes the Malaysian low-cost pioneer Airbus' biggest customer, with a total of 375 planes on order and 89 A320s already in service, and is the biggest single airliner sale in history.

Airbus chief commercial officer John Leahy also said that an unidentified firm had ordered 10 of the A380 super jumbos for $3.75 billion dollars.

By contrast, Airbus' 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 747 jumbo jet.

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 tell the story. Since January, Airbus has received 725 firm orders and Boeing only 195.

And the surprise key to Airbus' success has been the small A320 -- an unglamorous single-aisle workhorse now available as the "Neo" or "New Engine Option" which the company boasts is 15 percent more fuel efficient.

In Paris, the plane swept the board.

"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 $100 per barrel, fuel accounts for almost a third of an airline's operating costs, up from about 13 percent in 2001, according to the International Air Transport Association (IATA).

With the world recovery 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.

Airbus' victory is all the more significant given that 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, but 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 cede their places around the runway to tens of thousands of visitors come to see aerobatic displays and the latest planes.

© 2011 AFP

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