February 22, 2008 / 4:10 AM / in 10 years

JAL may buy Airbus planes after Boeing 787 delays

TOKYO (Reuters) - Japan Airlines Corp 9205.T is looking at buying some Airbus’ mid-sized A350 XWB planes after production delays for Boeing Co’s (BA.N) 787 planes, two company sources told Reuters.

Boeing faces increasing customer ire after announcing last month a second delay for the 787, pushing first deliveries out until early 2009 and the industry has been watching to see if any airlines will switch to Airbus.

The sources said JAL, which had planned to buy 55 787 planes, favoring their greater fuel-efficiency, was looking at purchasing Airbus planes as it wants to offset the cost of higher fuel prices quickly by using more mid-sized airliners.

JAL, one of Boeing’s most loyal customers, had previously decided to buy only 787s, hoping to cut costs on parts replacement, maintenance and pilot training. That has changed, the sources said.

“The risk of procuring from one firm for our next-generation planes is large. We should procure from more than one,” said a JAL executive.

The sources did not say how many planes JAL might purchase from Airbus EAD.PA.

    Boeing, the world’s top aircraft maker, was not able to say if the latest delay, which it attributed to issues with suppliers, would be the final one.

    Airlines have so far ordered 857 of the 787 planes, worth $140 billion at list prices, and some are seeking compensation for the postponement.

    Japan’s All Nippon Airways (9202.T) -- due to be the first to take delivery of the aircraft -- Australia’s Qantas (QAN.AX), and Air India AI.UL have said they will consider seeking compensation, which could cost Boeing billions of dollars.

    Reporting by Noriyuki Hirata, Writing by Edwina Gibbs

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