Friday 5 April 2013

Airbus Updates No.969


Airbus Regains Top Spot From Boeing In Q1


Airbus recaptured the aircraft industry's top spot in the first quarter as Boeing fell behind on orders and grappled with the grounding of its newest jet, the 787 Dreamliner, data from both companies showed.
A transatlantic battle had swung in the US company's favour for the first time in several years in 2012 as Boeing sold more revamped 737s and accelerated deliveries of the 787, making it top in the USD$100 billion annual jet industry.

But the balance of power shifted again in 2013 as Airbus landed a record Indonesian order last month and Boeing delivered just one 787 before the jet was grounded by concerns over the safety of its lithium-ion batteries.

Buoyed by the previously revealed USD$24 billion order from Indonesia's Lion Air, Airbus reported 431 orders, up fourfold from the first three months of last year and well above a total of 220 orders posted by Boeing for the same period.

Adjusted for cancellations, net Airbus orders totalled 410 planes in the first quarter. Boeing logged 209 net orders.

Quarterly figures are not generally used as a barometer but Thursday's data highlighted the industry's astonishing volatility after Boeing ended 2012 expecting to stay comfortably in front of its European rival.
A year ago, Airbus was smarting from publicity over wing cracks on the A380, the world's largest airliner, having broken annual order records just weeks beforehand.
"Boeing has had difficult circumstances this year, but both companies need to ensure they are ready for emerging competition in coming years," said aerospace analyst Howard Wheeldon, referring to aircraft projects in China, Brazil and Russia.

RED FLAG

The 787 was grounded in January after barely a year in service, leaving 50 new, high-tech planes idle worldwide.

Boeing has not stopped producing the jet but the outlook for deliveries will be determined by the timing of the aircraft's return to service complete with redesigned batteries.

While the decision lies with regulators, Boeing officials have said they expect the 787 to be in service "sooner rather than later," something markets interpreted as April or May.

Boeing said before the 787 crisis that it aimed to deliver 635 to 645 aircraft in 2013, including at least 60 Dreamliners. Airbus is targeting annual deliveries of 600 to 610 aircraft.

Ken Herbert, aerospace analyst at Imperial Capital in San Francisco, said Boeing could still reach its 2013 delivery target because production of smaller 737s was set to rise.

A question remains over deliveries of a slow-selling version of the 747 despite three new orders posted on Thursday, he said.

"It's a red flag, but I'm not seeing Boeing's guidance at risk yet," he said.

Airbus said it had delivered 144 aircraft in the first quarter, including four A380s, compared with 137 commercial Boeing deliveries.

Both companies have been enjoying robust demand from emerging markets and US airlines carrying out a long-expected overhaul of their fleets to take advantage of fuel savings.

Lion Air's recent order for 234 narrow-body A320-family Airbus airliners, signed in front of French President Francois Hollande last month, fuelled a debate over whether Southeast Asian airlines are gambling too heavily on new airliners.

Plane makers generally insist that demand from carriers like Lion Air, already one of Boeing's largest customers, underscores the transport needed to support projections of sharp economic growth. But bankers are warning of a potential order bubble.

Airbus, meanwhile, announced it had boosted production of the A330, an older passenger jet that has enjoyed a renaissance thanks to previous delays in production of the Boeing 787, to a planned record level of 10 a month.

However, it suffered a setback in its converted luxury jet business as one of two unidentified private buyers of its A350 cancelled its order.

British Airways and Iberia parent IAG, meanwhile, expanded an order for Boeing 787s this week and is reported to be in talks to place an additional order for A350s as early as Friday.
(Reuters)

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