10,000th sale lifts Airbus past Boeing in 2010

TOULOUSE, France Mon Jan 17, 2011 10:40am EST

TOULOUSE, France (Reuters) - European planemaker Airbus EAD.PA celebrated a surprise win in the annual orders race against Boeing (BA.N) with the 10,000th plane sale in its 40-year history, part of a $5 billion order from Virgin America.

A last-minute surge pushed Airbus past its U.S. rival for a third year as it held onto a 2010 net order market share of 52 percent in the face of a resurgent Boeing, which was hit by cancellations in 2009 due to delays to its 787 Dreamliner.

EADS subsidiary Airbus said on Monday it had sold 644 planes worth over $84 billion at list prices in 2010 after a surge of 200 orders in December, beating Boeing's total of 625.

For the eighth year running, Airbus delivered more planes than its U.S. rival, topping the 500 mark for the first time while Boeing deliveries fell 4 percent to 462. Planemakers only get paid on delivery, usually at least 18 months after purchase.

Airbus and Boeing are recovering from an industry recession which saw combined demand for their planes fall by more than two-thirds in 2009 as passenger and cargo air traffic plummeted.

"These figures show the economy is improving. We have dodged the bullet on a double-dip recession. Aviation is growing again because of Asia, low-cost carriers and emerging markets," Airbus sales chief John Leahy told reporters.

"The only negative on the horizon is the fuel price."

Airbus's late spree included the first firm purchase of a revamped A320 passenger jet, the A320neo, by Richard Branson's California-based low-cost airline Virgin America.

The British entrepreneur, on crutches after a skiing injury, staged a signing ceremony with Airbus executives, although the actual deal was concluded in secrecy at the end of December.

"To be chosen as the 10,000th customer is flattering and to be the customer of the most environmentally-friendly plane in the skies is particularly pleasing," Branson told Reuters.

Last week Airbus announced the world's largest plane order by volume from India's IndiGo, including 150 new model A320 jets, but the contract will probably be finalized in 2011.

Virgin America's order is for 60 Airbus A320 jets including 30 A320neo aircraft with newer engines. The upgrade aims to prolong the life of Airbus's best-seller by offering 15 percent fuel savings on the 150-seat, mid-distance plane.

The deal expands a provisional order announced last July for 40 A320 single-aisle passenger planes, plus options for 20 more. Airbus has since begun offering A320neos at a higher price.

Air India said on Monday it would lease 40 new planes from Canada's Bombardier(BBDb.TO) and Airbus.

STRONGER THAN EXPECTED

Adjusting for cancellations, Airbus sold a net total of 574 planes worth $74 billion in 2010 compared with Boeing's 530, giving the European firm a market share of 52 percent. This was stronger than many analysts had predicted.

Both firms more than doubled their order intake in 2010 as airlines staged a stronger-than-expected recovery. They share the commercial market for large airplanes with at least 100 seats but face challenges from Canada, China, Russia and Brazil.

Chief Executive Tom Enders said Airbus would increase commercial deliveries to 520-530 planes in 2011 and would sell more than it delivered, without giving a more precise goal.

"2010 has been better than we expected. We will look at 2011 more optimistically," Enders said.

Airbus had total revenue of "around 30 billion euros" ($39.9 billion) in 2010, Enders said, up from 28,067 billion in 2009.

Enders also said Airbus was mulling another increase in targeted wide-body production to 10 a month from nine. A330 demand has been buoyed by delays to the Boeing 787 Dreamliner.

Boeing reported 625 gross orders and 530 net orders in 2010 after more than doubling its sales from 2009 when business was left floundering by the financial crisis.

There were still dozens of cancellations in 2010 but both planemakers have thousands of planes on order.

Boeing has sold 20,663 commercial planes since January 1958, the first month for which records are available on its website.

The U.S. firm says the success of Airbus is due to unfair European government subsidies, a charge EADS denies. This has led to mutual subsidy claims at the World Trade Organization.

($1=.7512 Euro)

(Editing by James Regan, Alexander Smith and Sophie Walker)

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