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Mon October 7, 2013
Japanese Airlines Makes Deal To Buy Airbus Planes
Originally published on Tue October 8, 2013 10:18 am
MELISSA BLOCK, HOST:
Japan Airlines stunned the aviation world today by announcing that for the first time in the company's history, it will buy new wide-bodied jets from Airbus, the European aircraft manufacturer. The deal is worth billions and it's a big setback for Boeing, which has long dominated the Japanese aviation market. NPR's David Schaper reports.
DAVID SCHAPER, BYLINE: Airbus president and CEO Fabrice Bregier was positively beaming in Tokyo this morning in an interview with financial network CNBC.
FABRICE BREGIER: Yeah, it's a great event. It's a great event.
SCHAPER: A great event is his company's coup in signing a deal estimated to be worth over $9 billion. Airbus will supply 31 A-350 wide-body jet airplanes to Japan Airlines, an air carrier that for half a century has almost exclusively flown a fleet of Boeing aircraft.
BREGIER: It's probably the biggest order ever here in Japan. So we are very pleased we've got it. It's the biggest order this year of A-350s, with 31 first aircraft.
SCHAPER: Despite his company's long history with Boeing, the president of Japan Airlines says, as the company needs to replace its aging Boeing 777s, the Airbus plane is, quote, "the best match for our needs." So how is the news being felt in the aviation industry?
RICHARD ABOULAFIA: There are definitely shockwaves.
SCHAPER: Richard Aboulafia is an aviation industry analyst with the Teal Group.
ABOULAFIA: Japan had largely been in Boeing's camp for some time now, both on an industrial level and from a market standpoint. So a major defection like this is quite noticeable, especially when Boeing is trying to launch its new triple 7X to compete in exactly the same market segment.
SCHAPER: The triple 7X is Boeing's own replacement for the older 777s, but the American aerospace giant isn't expected to have any of those planes ready to fly commercially before the end of the decade. And Aboulafia says the slow development of this new generation in other big wide-bodies has now come back to haunt Boeing.
ABOULAFIA: There was a moment when Boeing could've been extremely aggressive with the triple 7X and with the 787-10 and really gotten a far higher percentage of the export market. Instead, they dragged their feet and Airbus was able to get their nose under the tent and they've done extremely well, far better than if Boeing had been more aggressive with this.
SCHAPER: Add to that the recent problems with Boeing's long-haul fuel-efficient 787 Dreamliner. It had four years of production delays and then in-cabin battery fires that grounded the fleet for four months earlier this year. Analysts say Chicago-based Boeing now could lose orders from another longtime Japanese customer, All Nippon Airways.
A spokesman from Boeing declined to be interviewed on air for this story, but issued a statement saying although we are disappointed with the selection, we respect Japan Airline's decision and will continue to work with them to meet their long-term fleet requirements. David Schaper, NPR News, Chicago. Transcript provided by NPR, Copyright NPR.