Don't resist order deferrals, Qatar Airways tells jetmakers

DUBAI (Reuters) - Qatar Airways Chief Executive Akbar al-Baker on Tuesday warned Airbus AIR.PA and Boeing BA.N against resisting the airline's requests to defer aircraft deliveries, in a battle over who should bear the strain of the coronavirus crisis.

FILE PHOTO: An Airbus A350-1000 aircraft of Qatar Airways is pictured after a delivery ceremony at the French headquarters of aircraft company Airbus in Colomiers near Toulouse, France, February 20, 2018. REUTERS/Regis Duvignau

The state airline, whose CEO has more usually been known for criticising delays at planemakers, is now in talks like many rivals to push back deliveries due to the impact of the crisis.

“We are negotiating with both Boeing and Airbus to fulfil our requirement to defer and we hope that both the manufacturers will oblige,” he told Reuters by phone.

“They have no other alternative to oblige and if they make it difficult to oblige we will keep them in mind and we will not do business with them again.”

Qatar Airways has ordered tens of billions of dollars of aircraft from the world’s two biggest planemakers.

But after a plunge in demand for air travel, it says it has no room for new aircraft and will instead shrink its fleet of around 200 jets.

Baker said he was hopeful of reaching agreements with both Airbus and Boeing, but that the airline would cancel orders if that was not possible.

He also cast doubt over a large order for Boeing 737 MAX jets, a model grounded since two fatal crashes last year.

Boeing declined to comment. Airbus said discussions with customers were confidential.

Aviation financiers say manufacturers hold a strong hand in such talks as they have binding contracts, but tend to be wary of damaging future business. However, Gulf airlines have placed big orders and are not expected to buy many jets any time soon.

Qatar Airways has signed a letter of intent for 60 737 MAX jets. It will sell five that have been delivered and hopes to reach “an accommodation” over those on order, Baker said.

The airline plans to keep about a 20% of its fleet grounded for the foreseeable future and does not expect to fly to all 165 of its pre-pandemic destinations before 2023, Baker said.

Its fleet of ten Airbus A380s will stay parked until at least mid to late 2021, he added.

Reporting by Alexander Cornwell; editing by Jason Neely and Mark Potter