Posted on 03/31/2006 10:56:19 AM PST by SW6906
Just when things were going so well for the European plane maker, two major customers demand costly redesigns. The likely winner: Boeing
Airbus, struggling to gain altitude against a couple of archrival Boeing's (BA) hot-selling models, has hit two major patches of turbulence in the past few days.
On Mar. 28, the European planemaker's biggest customer, the International Lease Finance Corp., a Los Angeles-based subsidiary of American International Group (AIG), called for a top-to-bottom redesign of the A350, the plane Airbus plans to launch as a rival to Boeing's 787 Dreamliner.
FUEL FACTOR. Then, on Mar. 30, Airbus acknowledged that Dubai-based airline Emirates, the biggest buyer of its A340 widebody plane, has delayed a $4 billion order for 20 of the aircraft because it wants them redesigned to match the fuel efficiency of Boeing's competing 777 model.
This adds up to a big embarrassment for Airbus. But even more important, these public rebukes by two key customers are likely to cause severe problems for Airbus's financial-planning and marketing efforts.
...
Even before the criticism by Udvar-Hazy, Airbus was struggling to match Boeing's sales success with the 787. Since putting the A350 on the market in December, 2004, Airbus has logged 100 firm orders -- including an order for nine planes signed on Mar. 30, 2006, by Finnair. That compared with 291 orders booked by Boeing for the 787 since May, 2004.
Moreover, it's unclear how Airbus would finance R&D for a more-expensive A350 without loans from European governments. Airbus has used such loans in the past to pay for up to one-third the cost of developing new planes such as the doubledecker A380. But now the U.S. has complained to the World Trade Organization that the loans amount to unfair subsidies.
Much more at the link......
(Excerpt) Read more at businessweek.com ...
Ping!
Ping!
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Subsidies are against WTO rules, no?.......
Ping!
Thanks for the ping. I just love these articles. ;)
The only thing I can see that Airbus gets and Boeing does not is the access to below-market "loans".
That's "Schadenfreude" -- you pronounce the "e" at the end.
This is gonna send the Aribust defenders into a tailspin.
They just have to redefine the money so it's not a subsidy.
Depends.
Kinda like campaign contributions......
Airbust defenders on this site?!?
I havent seen that....
THIS WILL MAKE YOU LAUGH - - NEWS FLASHBACK 11/22/04 - Subject A350 launch decision.
``It's Airbus's job to make life harder for Boeing and an A350 launch will do just that,'' said Richard Aboulafia, vice president of the Teal Group, a Fairfax, Virginia-based consulting company. ``The 7E7 (787) business case is not sewn up yet.''
Testing times - Airbus and Boeing (Airbus has a small problem)
bump
Prolly find lots of them over at DU!
A380 flop
Herkules flop
Tiger flop
Eurofighter flop
Galileo flop
Yet they just have an endless supply of cash. Hmmmmmmm must be nice. And of course they will have massive investment into an accelerated development of the A350.
What will the Europeans do? Deny the fact that EADS is heavily subsidiesed, make counter accusations, keep moving on.
You must not come on these Airbus threads much.
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