UPDATE 3-Airbus delivers first A380, denies new delays

Mon Oct 15, 2007 9:28am EDT

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(Recasts after news conference)

By Tim Hepher

TOULOUSE, France Oct 15 (Reuters) - Airbus handed the first A380 superjumbo to Singapore Airlines on Monday in a slick ceremony designed to lift its image after two years of setbacks, but was forced to deny rumours of another bout of delays.

Delivery of the world's largest passenger jet to its first customer came as a huge relief to the European group, which has been working under siege for months after wiring glitches spiralled into financial crisis and caused a political scandal.

France's Journal du Dimanche newspaper, owned by one of the company's main shareholders, Arnaud Lagardere, reported on Sunday that Airbus remained worried about deliveries and had launched new measures last month to avert further delays.

"There are no delays; that is a misunderstanding," Airbus sales chief John Leahy told reporters.

Asked if Airbus was reaffirming its 2008 delivery target of 13 aircraft, Leahy said: "That is our plan and we are on target. We have said it is a challenge, of course, but we are on track."

A foul-up over the installation of the 500 km of wiring on the double-decker A380 planes in 2006 toppled Airbus management, pushed the planemaker into loss and put back Europe's biggest industrial project by two years, leading to 10,000 job cuts.

In a new setback, a senior executive said Airbus's A400M military airlifter had also been delayed by another two months.

"The A380 is not a luxury, it is a necessity. That's why increasing A380 production to meet demand remains our biggest challenge for the next two years,"Airbus Chief Executive Tom Enders told a crowd of airline industry guests and journalists.

"Everything we have accomplished so far gives us the confidence, the courage and the means to face the big ramp-up in 2008 and 2009," he said.

He refused to rule out further delays, telling reporters: "We have confidence, but in life, nothing is guaranteed".

The first aircraft was delivered to Singapore Airlines 18 months later than planned at a heavily stage-managed ceremony at Airbus's headquarters in Toulouse, France.

Amid pounding music and a high-tech light show, a curtain was drawn back to allow gathered guests and television cameras to see the massive plane nosing into a parking stand.

"From today, there is a new queen of the skies for air travel," said Singapore Airlines CEO Chew Choon Seng, describing the rival 747 as a plane based on outdated technology.

The A380 will enter service between Singapore and Sydney with a flight raising money for charity on Oct. 25.

Full commercial service will begin on Oct. 28.

DOUBLE BED

With two passenger decks and room for a bar and shops, the A380 claims 50 percent more floor space than the 747 and its designers boast it will introduce a new era of airborne luxury.

Singapore Airlines unveiled a cabin interior with 471 seats, compared with the plane's original standard of 555 seats, now reduced to 525 seats to accommodate new seat designs.

The Singapore version will have 12 self-contained suites.

For those with upwards of $22,000 to spend, the airline demonstrated how two first-class seats can be combined to form a double-bed, strewn with flower petals.

As Singapore Airlines gets five more aircraft in 2008, it will add daily London, Tokyo and Hong Kong/San Francisco services.

On-board entertainment will include 100 movies, more than 180 TV programmes, 700 CDs and over 22 radio channels. The same entertainment box will include a word processor and 3D games.

Airbus's Leahy said he did not rule out further sales of A380s this year after securing orders or commitments for around 30 in 2007. "I think we probably could do more A380s this year."

Airbus has 165 A380s on its firm order book but recent deals with British Airways BAY.L and Grupo Marsans have brought commitments for the $319.2 million jet to 189 planes spread among 16 airlines. It expects to sell 800 planes in 20 years.

Rival Boeing Co (BA.N) says demand for 500-plus seaters is a niche market compared with thousands for future mid-sized jets.

Plans call for 13 A380 deliveries in 2008 and 25 in 2009, with the first two dozen aircraft are being wired by hand while a new system is prepared to bring output to 45 a year from 2010.

Airbus expects to deliver a revised cargo version from 2014 or 2015 after studying the designs again around 2009.

* For details on the A380, click on [ID:nL15737627]

* A400M faces new delay [ID:nL15352438]

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