Airbus Outpaces Boeing With Fuel-Efficient Planes

June 21, 2011
U.S. airline JetBlue Airways announced Tuesday it has committed to buy 40 A320neos.

LE BOURGET, France --

Airbus benefited Tuesday from airlines' worries about sky-high fuel prices, winning customers for scores of its more fuel-efficient planes at the Paris Air Show as it jockeyed with Boeing for the spot as world's biggest planemaker.

Europe's Airbus sought to focus on its order books after it suffered a clipped wing, faulty gearbox and delays to a new jet ahead of the aviation industry's showcase event.

The star of this year's air show so far is a plane that won't be airborne until at least 2015: the Airbus A320neo. It is a revamped version of the workhorse A320 family of single-aisle short and medium haul aircraft, but with more fuel-efficient engines.

As oil prices have jumped higher this year, the plane has become the company's fastest selling model.

U.S. airline JetBlue Airways announced Tuesday it has committed to buy 40 A320neos, and upgraded its order of 30 A320 aircraft to the larger A321 model with wingtips modified to get greater fuel efficiency.

Airbus also received a commitment for 50 A320neos from U.S. aircraft leasing company CIT Group. A321neos have a list price of about $106 million, valuing the deal at up to $5.3 billion, but airlines often negotiate substantial discounts.

Taiwanese airline TransAsia Airways ordered 6 A321neos while Indonesian airline Garuda committed to buy 25 of the A320 aircraft. Garuda's commitment, which is not yet a firm order, includes 15 standard A320s and 10 A320neos.

Airbus began marketing the A320neo last December, and plans to begin delivering it in late 2015. It has already received 594 orders and commitments for the aircraft as of Tuesday.

Though Airbus' fuel-efficient planes stole the limelight, U.S. rival Boeing also piled up new contracts.

It announced a deal with Aeroflot for eight Boeing 777-300ER jets, worth $2.27 billion. Low-cost Nordic carrier Norwegian Air Shuttle announced an order for 15 Boeing 737-800 planes, worth $1.2 billion at list prices.

Beyond the race to announce orders, Airbus officialized a deal with Rolls Royce to supply new, more powerful engines for a revamped version of the A350-1000, a stretched model of Airbus A350 widebodied medium to long haul jets.

Airbus said Saturday it was delaying the first delivery of the A350-1000 version by two years until 2017, because it said customers demanded a more powerful engine. Airbus says the jet will burn 25 percent less fuel than Boeing's 777-300ER, its main competitor.

Airbus brought in orders and commitments for 263 planes worth a total of $26.1 billion so far this week.

As the show opened on Monday, Airbus and Boeing announced a total of $25 billion in orders, options and commitments.

The haul was an improvement from recent years despite a challenging environment for the industry, which faces high fuel prices, a slowing global economy and uncertainty caused by violence in the Middle East and Japan's natural disasters.

Airbus topped the totals, signing orders and commitments for 142 aircraft worth $15 billion at list prices, the company said Monday.

Rival Boeing countered with more than $11 billion worth of orders and commitments for 56 of its jets, including an order by Qatar Airways for six of its 777 jets in a $1.7 billion deal.

Skyrocketing fuel costs are a major issue for Airbus and Boeing customers, who will see their profits plunge to $4 billion this year from $18 billion in 2010, according to a forecast by the International Air Transport Association.

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