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 ...
How does Boeing do that?
Do what, get Airbus to bet everything on the A380 - a limited market ariplane - and then come out with a superior product that Airbus cannot now afford to compete against?
On the contrary, I always read about the Boeing v. Airbus battles... Its beats reality television!
I just havent seen any Airbust koolaid drinkers out there...
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.
Let's not forget that Airbust's definition of a "firm" order and Boeing's is completely different.
Airbust finds anyway it can to count, "option" orders which is that the airline company might order those jets in the future, but isn't financially bound to, as "firm" orders. Firm orders are where the airlines are contractually purchasing the planes and dates for the planes being delivered are negotiated. The airline manufacturer will issue a reserved slot on the assembly line for the plane to be built.
Airbust has gotten into the habit of counting option orders as firm orders so it can always claim it sells way more planes than it does.
Airbust in the last days of 2005 tried to count a massive order of planes sold to China which put them past Boeing in total plane orders. China came back later and said this order was still in negotiation and these weren't even option orders yet.
Everyone in the industry sees right through what Airbust did.
...and the A380 sales have slowed to almost zero...
Airbus: Stupid enough to want to have the biggest commercial airliner, stupid enough to try to build it.
IIRC.this month Airbus has the evacuation tests for the A380..Many think the plane will flunk...which means it can't be certified..
Agreed.
No worries the Soviet Union was also all fine and OK until it imploded economically. Get into your SMART car and drive to work; that is if you even have a job?
Unlike Germany where all you do is get with France and Italy and consolidate a bunch of previous state run entities under one roof with no competition and appoint some bureaucrat as its head and then massively subsidies it (The literal truth with EADS); in the US we have a private aerospace sector, something you dont understand in your socialist world view. You figure since you subsidies everything and have a near state command driven economy others must too have it that way.
You have in the US three major helicopter manufacturers:
Boeing (Owns Hughes now) - http://www.boeing.com/product_list.html
Bell - http://www.bellhelicopter.textron.com/
Sikorsky - http://www.sikorsky.com/details/0,9602,CLI1_DIV69_ETI720,00.html
Youre right though. If you EXCLUDE the defense sector and compare Eurocopter to all individual helicopter manufactures in the US, Eurocopter is bigger as a single entity. But if you add up the total volume of helicopters built for all three you get a very different picture. If you add the defense sector in, its even more skewed. Realize that for helicopters, defense is one of the main markets unlike say a PKW where its near entirely the civilian sector that drives revenue.
As I said before, be proud of EADS! After all YOURE paying for it, even if your to ignorant to realize it, just like the sozialschmarotzer who leaches off the system who you dont see as someone YOU pay for, EADS is getting this money from somewhere, and it is not from their success with the A380, Eurofighter, NH-90, Galileo, Tiger, Herkules products which are all terds that have been chrome plated. EADS is briefing failure as success.
How does it really work? You take State run entities like SNECMA which was a whopping 35% in private hands by 2000 or so (But there are stock; therefore its private in your head just like the FRAPORT or DB) was formed by the nationalization of Gnome & Rhône in 1945 and is the primary state turbine builder in France to this day and a main supplier for? Of course the private firm Airbus. Aerospatiale (State owned), add in a few other state entities or heavily state controlled firms like DASA and roll them all up under one Pan European aerospace conglomerate called EADS. Tell us who Sud Aviation was? The firm which later became Aerospatiale.
Airbus for the new German Euro centrist supra nationalist is more than a firm, its a symbol of Europe, a symbol of power economically and technologically. However, its Synthetic. Unlike P&W or GE or even little Garret and some others; in Europe you have primarily a state run aerospace sector. Your stocks wont fall, even if Airbus flys planes into forests and builds A380s that dont sell. The state is a major share holder and wont let Airbus fail, no matter what. But believe me when I say that You pay for it.
At this point a failure for Airbus would be catastrophic for the main engines behind it: Germany/France. If Airbus imploded on itself political careers would go up in flames. A whole INDUSTRY would go under. The secondary and tertiary affects economically would be beyond imagination at this point since this would be piled on top of stagnant economies in these two countries which are both running over 12% unemployed, busting their debt caps, have practically no industrial or economic growth, have dropping investments in capital goods and R&D. EADS will just continue to get money injected into it.
But in the meantime, as I told you before, accept the fact that Germany will soon be the 5th largest economy with India and China passing them. Germany and France have economically flat lined for a decade now and show no sign of change. Something you cant accept since its a matter of national pride is that these state subsidies, state holdings, are at least a part of the much larger problem which is crushing the German economy and Airbus in fact EADS all together falls into this category. You didnt help yourself with massive Braunkohle subsidies for years and silently just doing this without any big advertisement. You didnt help yourself with subsidies for the Vulkan Werke or over decades the German farmer (Who truthfully cant compete globally). In the end, there is a real tangible economic cost involved with these games. Just like the Soviets who also ignored basic economic principals (Actually they even partially denied them), you will go down for the same reasons. 20 years my little friend. Germany today is already done economically. Youre just waiting to die.
Strange how India is economically exploding almost like Germany during the Wirtschaftswunder, or China where near all growth is from the private sector
.. Want more examples? Ireland, Chile, UK under Thatcher, US under Reagan/Bush
.. Want some examples of applied socialist market theories? DDR, UdSSR, China ca. pre 1985, Cuba, Iraq (Under Saddam Yes, the Ba athists where socialists and Iraq did have social medicine etc)
.
Even in the US we have a mixed economy. There is Social Security, HUD, and and and. But
. the percent of state ownership, the total amount subsidized as a percent of GDP, the degree of state regulation etc is in comparison to Germany far far less. Almost all your arguments are based on a relative comparison where you try to equate a defense contract to a subsidy. Where you say look look the US subsidizes agriculture too! But what you fail to accept is that firms like Boeing are truly private firms and in the hands of private shareholders. Unlike ZDF, ARD, HR3, SWF, DW, NDR, WDR
. we only have PBS. One nation with 3.5 times the people and near 5 times the economic volume has one (1) state run channel. But like with Boeing, a fool like you would say You too have state run media, see you have PBS! While Boeing does make some money on defense contracts, this is not the same as direct money injections worth 15 billion Euro by 2005 for the development of private and for commercial use aircraft as Airbus has had. The A350 is being developed to a large degree with state subsidies! You cant say that about the 787, 777, 767, 757, 747, 737
.707.
While Boeing will get the contract for the new air to air tanker and will make some profit off of it. This is not the same as a direct subsidy with the intent to develop an airplane to be marketed on international markets as the A350 will be. See a difference? Probably not. But it does not matter. Since like the cancer patient in denial, you will eventually economically die from the disease you defend.
To: SW6906 Thanks, I am an airline junkie and I am constantly amazed at the abuse Airbus takes by people that don't know otherwise.
Boeings are made up of all kinds of foreign parts and there are lots of American built parts on the airbus.
Its OK for us to drive German cars with lots of French parts, but not for us to fly on an Airbus because of the European parts.
Rolls Royce makes the best, most dependable airline engines around, they are amazing and they are on lots of Boeing planes, but nobody rips on them.
39 posted on 03/30/2006 11:22:56 AM PST by Central Scrutiniser (No one censors speech they agree with.) [ Post Reply | Private Reply | To 34 | View Replies | Report Abuse ]
Freepers from Europe and Britain would be good bets.
Also, I remember from another aviation discussion board a bona-fide American conservative (an air force veteran no less) who was one of the most hardcore Airbus fans I have ever encountered. He was so lockstepped with Airbus policies that his posts on aviation industry were like "Airbus, right or wrong". Haven't seen him around for ages - not since 9/11 so I don't know what happened to him. Perhaps he is a Freeper now? ;-)
mmmmmm.... Bratislava -- gorgeous place, not quite as glitzy as Prague but far fewer tourists!
Very true, back in the old days then there was Boeing, Lockheed and MacDonnel Douglas there was a lot of bashing going on too. Now there just Boeing and Airbus but the bashing continues, LOL. Anyway I am glad Europe has a state of the art Aerospace industry. Airbus will keep Boeing honest and vice versa, my Dad flew a few years for Luftansa, great airline, IMHO the best.
The 380 is an amazing airplane, long term it is a real threat to Boeing. The 350 as planned ain't gonna cut it. Boeing on the other hand has pushed the 747 about to the limit, I see the 380 replacing it and Boeing not contesting that market. I could be wrong but does the world need two super sized airliners?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.