Airbus Overtakes Boeing in Sales Race
Airbus Industrie edged ahead of Boeing Co. on Tuesday in the multibillion-dollar race to notch up the most sales at Britain’s Farnborough Airshow.
In a flurry of mega-deals over the first two days of the weeklong industry showpiece, Airbus announced an estimated $14.5 billion of new orders to $13.3 billion for Boeing. After 30 years, their rivalry was as fierce as ever.
The overall sales estimate for the show--$36.6 billion--reflected a buoyant commercial aviation industry that is expected to double its airline fleet over the next 20 years.
“Just one day’s sales at the 2000 show has equaled all the sales in 1996 put together,” said a spokesman for what is one of the world’s biggest air shows, reflecting on Monday’s bumper orders.
“We are 15% bigger than we were at the last show in 1998 with more than 1,000 exhibitors from 25 countries.”
For Airbus and Boeing, this is a crucial marketplace. Every order that has taken months of elaborate negotiations to secure is presented with much fanfare.
Airbus, determined to topple Boeing from its top spot, said the top U.S. leasing firm, International Lease Finance Corp. of Century City, intended to buy 87 of its planes, including five of its proposed A3XX super-jumbos.
The A3XX double-decker was also given a strong vote of confidence by ILFC Chief Executive Steve Hazy. “We believe it will become the flagship of the 21st century,” he told reporters at the show.
Meanwhile, European short-haul airline British Midland, which is planning to inaugurate a long-haul service, placed an order for Airbus A330-200s, and Finnair said it had agreed to buy up to six narrow-body A320s.
On Monday, the opening day of the show, Air France and Dubai’s Emirates airline both put in the first launch orders for the new Airbus super-jumbos, for a total of 17 aircraft.
But as the sales pace increased, Boeing was not to be outdone.
After its Airbus super-jumbo purchases, Emirates also announced that it would be taking six Boeing 777-300 wide-body planes in a $1-billion deal.
That followed the first-day announcement that two leading aircraft leasing companies are taking a mix of 18 longer-range 777s.
“We are doing great,” Boeing’s Chief Financial Officer Mike Sears told Reuters. The U.S. giant’s share price hit a two-year high.
In 1999, Boeing delivered a record 620 airplanes but posted slim profit on the sales. Now it is trying to squeeze more profit out in a cutthroat market.
“It is still tough because the competition is tough,” Sears told Reuters.
Boeing says Airbus has overestimated the demand for a super-jumbo jet, that there is a market for only 500 of them in the next 20 years. Airbus puts the figure at 1,500.
Boeing is also casting a wary eye over the Airbus books, saying that any European government loans for the A3XX must be made on commercial terms and be fully repaid. Otherwise it will challenge the aid in the World Trade Organization.
However, with nine other airlines also expressing interest in the super-jumbo, Airbus Chief Executive Noel Forgeard believes that the Europeans have their forecasts right for the plane, which should take to the skies in 2006.
“This will show our competition, Boeing, which was so vocal in claiming there was no market for such an aircraft,” he said.
