Emirates Airline is considering scrapping a massive US$20bn deal with Airbus for its delayed 45 new A380 Superjumbos and instead switch to rival Boeing unless Airbus’s compensation package matches the Arab carrier’s expectations.
Emirates, which has the largest order for the A380 555-seater aircraft, is claiming compensation from Airbus due to ongoing delays that stretch to two years and that could seriously dent the carrier’s ambitious expansion plans. The airline is now considering buying additional planes from rival Boeing unless Airbus offers a satisfying compensation payment. Tim Clark, president of Emirates Airline, said in an interview last week that compensation charges would be “a big one”, and that the airline would start talks with Airbus this month or in near February.
“The information that Mr Clark gave is sound, yet our main concern is to get the planes on the fleet, not the compensation,” a spokeswoman for Emirates Airline told Arabian Business.
Emirates is thought to be planning to buy an extra 100 aircraft with the option of either the Airbus A380 or the Boeing 787 Dreamliner. The spokeswoman did not enclose details of the amount of the compensation payment, but said that Emirates Airline was “still evaluating both options” (Boeing and Airbus) and that “no final decision had yet been completely made”.
Qatar Airways CEO Akbar Al Baker has criticised Airbus for not mentioning the delays sooner. The airline, which has two orders for the A380, announced seven new routes last year including its first to the US, but has also experienced a slowdown in its growth plans due to the delivery delays of the plane. “There would have been more (new routes) had it not been for the delays,” Al Baker said. According to industry figures, Airbus needs to increase sales of its A380 Superjumbo by 50% in order to cover additional costs caused by the two-year delivery delay, while profitability could decrease to around 13%. Meanwhile Boeing has announced that the production of its Dreamliner aircraft is on time, and that it is scheduled to enter services in May 2008. Emirates Airline hopes that the A380 deliveries will start in August 2008 — as opposed to April this year — and that commercial services will take off in the two last months of 2008.
Follow us on
