Airbus piles pressure on Boeing
LE BOURGET, France, June 21 - Airbus piled up orders for its revamped A320neo passenger jet at the Paris Air Show on Tuesday, putting more pressure on Boeing and limiting scope for new rivals as Russian premier Vladimir Putin arrived to tout his country's aerospace industry.
European planemaker Airbus notched up $14.4 billion of orders on the first day, outselling U.S. rival Boeing's $9.3 billion. Early on Tuesday its sales chief said it had 544 commitments for its new A320 aircraft, including a memorandum of understanding with leasing company CIT (CIT.N) for 50.
Airbus had won almost 100 orders and commitments for its A320neo family of planes worth about $8.3 billion based on list prices by 0939 GMT on Tuesday.
Indian budget carrier IndiGo could confirm on Wednesday a $16 billion order for 180 Airbus aircraft, provisionally made in January, industry sources said.
Healthy demand from buyers at the show has provided evidence that a solid upswing in civil aviation is underway, powered by emerging markets in Asia. The hike in oil prices this year has also given buyers a new sense of urgency to get more fuel-efficient aircraft.
Long-time rivals Boeing and Airbus are locked in a strategy battle over the huge market for single-aisle aircraft. These narrow-body planes, the backbone of the fast-growing budget airline market, are set to be the main battleground for orders between Airbus and Boeing at the biennial air show.
Airbus (EAD.PA) is marketing a revamped version of its A320 and Boeing (BA.N) is holding back on deciding whether to upgrade or redesign its 737 passenger jet, the best-selling plane in aviation history.
"I think it is going to be a different conversation at the end of the week, depending on what Airbus achieves this week in terms of orders for the neo," Henri Courpron, Chief Executive of International Finance Lease Corporation, the world's largest aircraft leasing company told Reuters.
"So if we assume, based on rumours and reports, that the neo is going to be a great success this week, then it prompts Boeing to do something. It cannot do nothing," he said.
Airbus believes it has the upper hand with the A320neo, whose more efficient engines save airlines 15 percent in fuel costs, according to the company.
Boeing conceded it might lose some custom while it ponders the future of its 737. The firm said on Sunday it would decide by year-end on its new strategy.
But Boeing (BA.N) outsold Airbus in the market for more expensive long-haul planes, including for a new version of its most recognisable jetliner, the 747.
China and Russia have a major presence at the air show this year as they look to muscle in on the two established passenger aircraft manufacturers.
China has come to the show for the first time with a model of its own passenger jet.
Moscow is currently pushing for Russian companies to up their spending in research and development as the government seeks to modernise and diversify the economy away from oil and gas and resources.
Russian planemaker Sukhoi is to bring a business jet version of its regional airliner to the market, showing the country's intent to make an impact on the international aircraft market.
SuperJet International is a joint venture between Italian Finmeccanica's (SIFI.MI) Alenia and Sukhoi. "We are targeting a market of between 80 and 100 aircraft over the next 20 years," SuperJet International CEO Carlo Logli said.
Russian Prime Minister Vladimir Putin, who arrives at the air show later on Tuesday after meeting French President Nicolas Sarkozy and Prime Minister Francois Fillon, will look to promote the Russian civilian and military aerospace sector.
Commercial Aircraft Corporation of China (Comac) expects to have its C919 up and running by 2014 with first deliveries two years later, Wu Guanghui, Comac's vice-president in charge of design and engineering said on Monday.
The plane could eventually rival Airbus' A320 and Boeing's 737 in the short- and medium-haul market. It has signed a deal with budget carrier Ryanair (RYA.I) for aircraft development.
Brazil's Embraer (EMBR3.SA)(ERJ.N), the market leader in the regional jet market, sees "good chances" of firm orders from U.S. carrier Delta Air Lines (DAL.N).
"Our expectation is that Delta decides about all this in October ... they are in talks with everyone," Paulo Cesar de Souza e Silva, who heads Embraer's commercial aviation unit, said in an interview with Reuters at the show. (Additional reporting by Victoria Bryan, Gilles Guillaume and Matthias Blamont; Writing by John Irish and Jane Merriman; editing by Sophie Walker)
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