Airbus Beats Boeing to Libyan Plane Order

Airbus announced the sale of 12 passenger jets to Libya's Afriqiyah Airways on Tuesday, scooping one of the first plane deals with the North African nation since sanctions were lifted.

Airbus, which arrived at the Farnborough International Airshow still reeling over plane delay problems that led to the departure of top executives, said that the deal was a sign of confidence in the company.

Tripoli-based Afriqiyah signed nonbinding commitments to buy nine jets from the single-aisle A320 family and three larger A330 widebody airliners, in a deal worth about US$1.7 billion (euro1.36 billion) at list price.

"We are proud of this sign of confidence, and look forward to creating a long-term win-win cooperation," said Airbus Chief Executive Christian Streiff.

Airbus said orders for the A320 family now stand at more than 4,300 aircraft.

On top of the plane order, Airbus parent European Aeronautic Defence & Space Co. signed a deal with the Libyan authorities to build a pilot and maintenance training center and a maintenance base in Tripoli. The maintenance base will service the Afriqiyah fleet as well as aircraft from other regions of Africa.

Afriqiyah Chief Executive Officer Abdallah Sabri Shadi said the order was the first significant order of new aircraft out of Libya in 30 years. He predicted there would be more new orders from Libya for both Airbus and rival Boeing Co. as new operators start up in the country.

Both the United States and EU eased sanctions against Libya in 2004, opening the way for the resumption of commercial plane sales to the country.

Sabri Shadi said the airline had considered Boeing for the deal. "There were negotiations that took a couple of months," he said. "In the end we selected the right products."

Another Libyan airline, Buraq Air, ordered three Boeing 737s last year.

Airbus is using the Farnborough air show, one of the biggest events in the aviation industry, to reassure investors that it is back on track after the furor over delays to its flagship A380 superjumbo that led to the departure of top executives and customer dissatisfaction with the design of its mid-sized A350.

On Monday, it announced a US$10 billion (euro8 billion) revamp of its troubled A350 program to take on two of Boeing's best-selling jets.

The previous version of the planned A350 had been billed as a rival to the Dreamliner 787, but had won just 100 firm orders - compared to 360 for the Dreamliner. Airbus also fell behind on total order value last year as its larger A340 jet lost ground to Boeing's more efficient 777.

The new A350XWB - for "extra-wide body" - will take on both the Dreamliner and the 777. Its industrial launch - when the company begins taking binding orders - will go ahead in October, for entry into service in 2012.

Boeing announced Tuesday that leasing company Pegasus Aviation Finance Co. has signed an order for six Dreamliners. The order is valued at around US$918 million (euro729 million) at list prices.

Mike Bair, head of Boeing's 787 program, said the U.S. company was prepared for competition from its European rival.

"It's still relatively vague about exactly what they are doing, but we always anticipated some kind of competition from Airbus," Bair told journalists during an update on the Dreamliner's progress.

On Monday, Airbus announced the sale of 10 A320 single-aisle jets to India's GoAir Monday - a deal worth about US$700 million (euro554 million) at list prices - and Boeing said Indonesia's Lion Air had exercised an option buy an additional 30 737-900 jets, with a catalog value of over US$2.2 billion (euro1.7 billion).

LoadAir Cargo, a new air freight operation based in Kuwait, also said it had signed an order with Boeing for two 747-400 extended range freighters.

Boeing also put out - and then recalled - a release announcing an order for 20 of the jets valued at US$4.9 billion (euro3.9 billion) shortly after Qatar canceled a scheduled news conference. Qatar Airways said no contract had been signed and it was still in talks with both airlines.

Airbus won more orders than Boeing for a fifth straight year in 2005, but reported only 117 gross orders for the first half - less than a quarter of Boeing's total.

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