Airbus pays Emirates damages for A380 delay
DUBAI (Reuters) - European plane maker Airbus paid Dubai's Emirates EMAIR.UL as much as $110 million during the last year in compensation for the late delivery of the A380, of which the Arab carrier is the largest customer, Emirates said.
Emirates, which has ordered 58 of the world's largest passenger planes, received 404 million dirhams ($110 million) during the year to March 31 in "liquidating damages", according to its annual report released on Wednesday.
Liquidating damages refers to compensation from parties who failed to meet contractual obligations with Emirates, the largest Arab airline. There were none the previous fiscal year.
"A large part of that was part of the compensation deal for the delay of the A380s," Emirates President Tim Clark told Reuters in Dubai on the day the state-owned carrier said profit soared 62 percent to 5.02 billion dirhams in the year to March 31.
Clark declined to give further details about the compensation agreement with Airbus, following a near two-year delay in the delivery of the 525-seat, double-decker planes.
Airbus Chief Executive Officer Tom Enders told reporters in Dubai on Tuesday that meeting a new schedule for delivering the A380 to customers was a "battle" and always of concern. The reputation of parent EADS (EAD.PA) is seen at stake as it strives to deliver 13 of the planes this year.
Clark said he was confident he would receive five A380s before March 31, and expects to received another 12 in the year to March 31, 2010.
"It would be a huge blow if there were further delays," Clark said. "There are rumors that are starting to rattle" about further delays, he said.
(Editing by Rory Channing)
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