By Tim Hepher and Cyril Altmeyer
PARIS, June 13 Airbus mapped out a potential
revamp of its A330 jet, but vowed not to let the estimated $2
billion investment divert it from improving profits at Europe's
largest aerospace group.
Fabrice Bregier, chief executive of the flagship planemaking
unit of Airbus Group, said the company would decide
whether or not to launch a re-engined version of its most
profitable wide-body jet before the end of the year.
"We are studying it. We have many customers telling us 'this
aircraft is excellent, please try to also reduce the fuel burn
with new engines," Bregier told reporters.
"So we are looking at that, we are not rushing. We will take
the decision this year. It's not limited to putting new engines
on, it's more complicated than that."
Airbus faces a drop in orders for the 20-year-old A330 from
2016 as attention switches to the newer Boeing 787, but appears
progressively more confident about being able to prolong its
wide-body 'cash cow' with improvements in fuel efficiency.
But this depends on a number of factors including advanced
talks with engine manufacturers General Electric and
Rolls-Royce and the outcome of a debate about whether the
market is big enough to support more than one choice of engine.
It must also weigh the fuel savings provided by newer - but
larger - engines against their increased weight and drag.
Airbus believes matching the performance of the Boeing 787
is within reach because of factors such as cheaper maintenance
and dismissed what its strategy chief Kiran Rao described as a
misconception that the new Boeing airplane is lighter. Although
built from advanced materials, it also carries more structure to
give it a range that most customers don't need, Airbus said.
A Boeing spokesman responded that the 787 is lighter. Boeing
officials have also said it is competitive whatever the range.
The U.S. planemaker has dismissed the A330 makeover as a
short-term distraction but has pledged to "react" in a sign that
it may be tempted to shift its pricing strategy.
Airbus said it would only go ahead with the project if it
could see a market for the A330 throughout next decade,
indicating it sees the exercise as more than a brief stopgap.
The A330 review comes as Airbus looks beyond the anticipated
December service debut for its brand-new A350, which it says is
on schedule, to the production ramp-up needed to make it
profitable by 2019 in line with its targets.
Bregier, who has made avoiding the delays and cost overruns
that beset the rival Boeing 787 Dreamliner his chief
priority, said the A350 would prove itself financially and
downplayed the impact of a major order cancellation this week.
"At the end of the day, we are looking at profitability,"
"We believe that at the end of the decade we will have not
only the A320, the A330, but also the A350 very profitable. On
the A380 our goal is to break even. If we have that, the
financial challenges that you know for Airbus will be met."
Some analysts have expressed concerns over the strategy for
the aircraft after Emirates cancelled 70 airplanes.
Bregier meanwhile held out the prospect that Airbus would
continue to increase production of smaller narrowbody
A320-family jets if the market called for it.
Airbus and Boeing are producing narrowbody jets at record
rates in what is the largest segment of the market and have
suggested they could go even higher from around 2018.
"There is no industrial limit. Conversely, I don't want to
build extra capacity and not be able to make the best use of my
cash," Bregier said during an annual media seminar.
(Reporting by Cyril Altmeyer, Tim Hepher, Editing by Geert de