'Very disappointed' if A380 delayed - Emirates

AIRCRAFT DELAY: Emirates said it would be disappointed if Airbus failed to deliver its order of A380’s on schedule.

Dubai-based airline Emirates will be "very disappointed” if Airbus fails to deliver its order of A380’s on schedule, but does not expect any delay, its chief told ArabianBusiness.com on Wednesday.

European aircraft maker Airbus said on Tuesday the company was carrying out a major review of delivery targets for the A380 superjumbo and might meet them, raising the possibility of further delays.

RELATED: Mideast airlines face further A380 delay

“We are very confident they will be delivered, [but] we will be very disappointed if they do not deliver,” Chairman and CEO Sheikh Ahmed bin Saeed Al-Maktoum said on the sidelines of a press conference announcing Emirates 2007/08 financial results.

Emirates President Tim Clark told reporters on Tuesday he was confident of taking delivery of four A380s by the end of this year and another by next March. Airbus' targets called for 13 deliveries of the world's biggest passenger aircraft in 2008.

Emirates' first flight using the A380 is expected to be on October 1 from Dubai to New York. The airline will initially use the superjumbo on its New York, London and Sydney-Auckland services.

RELATED: First A380 flight to New York a sell-out

Airbus has already delayed delivery of the A380 three times, causing its delivery schedule to fall almost two years behind after a series of industrial mishaps since 2005.

Emirates has ordered a total of 58 A380s, making it the single largest customer for the jetliner.

The airline said it posted a 62% rise in profit to $1.37 billion for the last fiscal year on the back of higher passenger and cargo traffic, despite soaring fuel costs.

Included in its profit was a "large" part of a 404-million dirham payment for "liquidating damages" came from Airbus for late delivery of its A380s, Clark said on Wednesday at the press conference.

Sheikh Ahmed said Emirates had spent $500 million more on fuel in 2007-08 than budgeted for due to record high oil prices, which this week almost broke through the $120 mark.

Fuel was the main expenditure for the carrier, representing 31% of total operating costs, he said. Surging fuel costs would continue to be a major challenge for the group, he added.

"It was another record year for the group despite the challenging business climate, particularly in the second six months where the soaring cost of jet fuel made a big dent," Sheikh Ahmed told reporters.

The airline recorded revenue of $10.8 billion, up 27% on last year. Flights to Europe and the Americas contributed the biggest segment of revenues at 13.6 billion dirhams, up from 10.5 billion dirhams previously, followed by East Asia and Australia.

The airline, which added 13% in new capacity in the fiscal year, saw a 21% rise in passengers to 21.2 million while cargo rose 10.9% to 1.3 million tonnes.

Passenger revenues rose 29.5% to 28.1 billion dirhams while cargo revenues climbed to 6 billion dirhams, from 5 billion dirhams.

The airline said its load factor was 79.8% in the fiscal year, up from 76.2%.

Sheikh Ahmed confirmed during the conference the carrier had no immediate plans for an initial public offering (IPO), saying a decision was yet to be made by the government.

RELATED: Emirates considering IPO

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