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Airbus SAS

Leahy: Airbus expects to win orders from Chinese carriers

Sep 16, 2010

World’s largest planemaker, Airbus SAS, may win orders from Chinese airlines before year-end said company's CEO.

“We are hopeful of some orders before the end of the year,” John Leahy, Airbus SAS chief operating officer, told reporters in Hong Kong after arriving from Beijing, where he said he had been “discussing deals.”

Blomberg reports that Airbus’s last big mainland Chinese order was signed in 2007 and worth $17 billion at list price. While airlines subsequently cooled expansion plans during the recession, passenger numbers in China have jumped 18 percent this year amid domestic growth and an international recovery in business and leisure travel.

“Aircraft orders are picking up,” said Frank Skodzik, an analyst at Commerzbank in Frankfurt with an “add” rating on shares of Airbus parent European Aeronautic Defence & Space Co. “The trend should continue in the next couple of years, driven by Asia and Latin America.”

Chinese airlines have shown “a lot of interest” in planes ranging from single-aisle aircraft up to A350 and A380 widebodies, Leahy said at an event to confirm a contract from Cathay Pacific Airways Ltd., Hong Kong’s biggest carrier, for 30 Airbus A350-900 planes worth $7.82 billion at list prices. The airline said it won “significant price concessions.”

Order Report

According to Bloomberg, Airbus may announce an order for at least 150 aircraft when Chinese President Hu Jintao visits France in November, newspaper La Tribune said on Sept. 13. The company won a deal from China for 160 planes in November 2007, following two $10 billion pledges for 150 aircraft in 2005 and 2006.

“I think the French media occasionally get a little bit ahead of themselves,” Leahy said in Hong Kong.

China orders planes centrally and distributes them to carriers. Airbus has also opened an assembly plant for A320 aircraft in Tianjin to help boost sales to the country.

Air traffic rose almost 11 percent in the Asia-Pacific region in the year to July, according to the latest International Air Transport Association data. That compares with 6.3 percent in North America and 3.6 percent in Europe.

Boeing Co. has agreed a total of 30 orders this year for 737 planes from Air China Ltd., China’s largest international carrier, and Okay Airways Co., according to its Website.

EADS was trading down 1.5 percent at 18.70 euros as of 5:10 p.m. in Paris, paring the stock’s gain this year to 33 percent and valuing the company at 15.27 billion euros ($20 billion).

Leahy: Airbus expects to win orders from Chinese carriers
Airbus CEO John Leahy / Image via


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