UPDATE: Airbus To Maintain A380 Output Pace; Expects US$1.3 Trillion Market In Asia Pacific Over 20 Years
February 14 2012 - 11:26PM
Dow Jones News
Airbus will maintain a higher rate of production of its A380
super jumbo and aims to deliver 30 such planes this year even as it
repairs cracks found on parts of the passenger jets' wings,
according to Tom Enders, chief executive.
"Despite the issue right now with the cracks in the wing ribbed
feet...We're maintaining our planned increase in production (of the
A380)," Enders told reporters at the Singapore Airshow. "Meanwhile,
our A380 network continues to grow."
Airbus, a unit of European Aeronautic Defence & Space Co.,
or EADS (EADSY), will deliver the A380 to Malaysian Airline System
Bhd. (3786.KU) and Thai Airways International PCL. (THAI.TH) this
year. At present, 69 A380s are in service with seven carriers.
Airlines including Singapore Airlines Ltd. (C6L.SG) and Qantas
Airways Ltd. (QAN.AU) have had to repair cracks on some of its A380
wings. "We will ensure that our operators and customers are as
little disturbed as possible," Enders said.
Enders said it will pick up the tab for the repairs but declined
to give an estimate. He also didn't disclose any details of
discussions with airline customers on compensation and insisted
that the A380 is "absolutely safe" to fly.
Airbus will implement lessons learnt from the A380 program on
its A350 planes, Enders said. The A350 program is running behind
schedule but the company isn't in a hurry to rush production as it
wants to avoid any possible problems with the jets after they enter
service, he said.
Separately, Airbus said in a statement that airlines in the
Asia-Pacific region will take deliveries of about 9,370 new
aircraft valued at $1.3 trillion over the next 20 years.
"That's good news for Airbus and the region alike. Asia-Pacific
is second to none when it comes to current and future business
prospects and aviation growth will bring increased trade and
significant wealth creation into the region," said John Leahy,
Airbus chief operating officer for customers.
Airbus said it expects passengers carried by airlines in the
Asia-Pacific region to rise 5.9% per year, outstripping an
estimated 4.8% annual growth globally. Similarly, in the freight
business, Asia Pacific will lead the world with a 5.6% annual rise,
compared with an expected 5.1% average increase globally, according
to the statement.
The region will also lead global demand for wide-body aircraft
due to concentration of growing populations around the main urban
centers. The maker of the A330 and A340 wide-body planes expects
airlines in the region to buy 3,650 such aircraft in the next 20
years.
Globally, Airbus expects demand for 27,800 new passenger and
freight airplanes valued at US$3.5 trillion over the next 20
years.
Arch rival Boeing Co. (BA) Monday projected that for the
2011-2030 period, global airlines will require 33,500 new aircraft
worth about US$4 trillion, with demand from the Asia-Pacific region
likely at 11,450 new planes worth US$1.5 trillion during the same
period.
Airbus said it isn't concerned about getting fewer orders in
2012 after receiving orders for a record 1,608 planes last year.
Leahy said the company expects new orders to outpace production in
2012, without giving a specific forecast for expected orders this
year.
Airbus has a backlog of 4,500 planes and its annual production
is about 550 jets.
The company hasn't received any requests from its Indian
customers to delay deliveries of planes, Leahy said in response to
a question on whether the nation's carriers, which recently
reported huge losses, have asked for changes to delivery plans.
In other announcements on Wednesday, Airbus said it has signed a
deal with Indonesia to sell nine C295 military transport aircraft
for US$325 million and it, along with another EADS unit and the
aerospace arm of Singapore Technologies Engineering Ltd. will
develop a program for converting A330 passenger jets into cargo
freighters.
Conversion work will be done mainly in Dresden, Germany, and the
first converted A330-300 cargo jet will enter service in 2016, the
company said.
-By Gaurav Raghuvanshi and Chun Han Wong, Dow Jones Newswires;
+65 64154 154; gaurav.raghuvanshi@dowjones.com