China signs deal to buy 60 Airbus planes

BEIJING Thu Apr 25, 2013 9:04am EDT

BEIJING (Reuters) - China signed a deal with European planemaker Airbus on Thursday to purchase 60 planes, as French President Francois Hollande began a two-day visit to China.

The deal, worth at least $8 billion at list prices, partially lifts what Airbus has described as a Chinese boycott on the purchase of long-haul A330 jets imposed during a recent row with the European Union over airline emissions.

A large entourage of French businessmen is accompanying Hollande, who is the first leader of a major western country to visit China since President Xi Jinping was named to his post last month.

Airbus said the order included 18 wide-bodied A330s.

According to the planemaker, China last year blocked orders for up to 45 of the jets in protest at EU measures to make foreign airlines pay for carbon emissions.

On Thursday, Airbus also announced Chinese orders for 42 smaller A320-family jets.

Some European industry officials had hoped for an order of 100 aircraft or more to feed China's rapid aviation growth.

A group of nations backed by China argues that the EU's emissions trading scheme infringes their sovereignty, since it bases the charges on whole trips, including the parts in non-EU airspace.

The EU says such measures are necessary under the bloc's obligations to tackle pollution.

In November, the EU's executive Commission agreed to suspend the scheme for foreign airlines for a year, pending international negotiations and amid warnings of retaliation.

The suspension took effect on Wednesday and was officially published just before Thursday's Chinese signing ceremony.

Citing the dispute, Airbus last year halted plans to increase production of the A330 to 11 planes a month.

The EADS EAD.PA unit says 1,000 European jobs are at stake in the decision on whether to go ahead with the plan, which would lift production from a record 10 a month reached in early April.

It has not said how many orders would need to be unblocked for the step-up in production to go ahead.

A United Nations aviation agency is overseeing efforts to come up with a global policy on aircraft emissions.

(Additional reporting by Barbara Lewis; Writing by Michael Martina and Tim Hepher; Editing by James Regan)

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Comments (1)
MikeBarnett wrote:
China is continuing its infrastructure projects for the next decade because it needs to bring the north and west to the level of the east and south. These projects include new airports and improvements to existing airports to move passengers and cargo more rapidly than by road and rail that are also being built or improved. New airports need more planes, so Airbus receives more orders. The EU is China’s biggest trade partner, so China helps the prosperity of the EU and may receive more orders for Chinese goods from prosperous EU customers. That idea helps China remain the economic powerhouse of the world. If you take good care of your customers, your customers will take good care of your paychecks and your company’s profits.

Apr 25, 2013 3:03pm EDT  --  Report as abuse
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