Airbus gets green light to develop a rival to 787

Airbus parent EADS decided Friday to go ahead with development of a new mid-size jetliner to strike back at Boeing Co. in their fight for market share.

The European company said its board had agreed -- after months of uncertainty -- to build the A350 XWB. An earlier version of the plane, which will vie for customers against Chicago-based Boeing’s 787 Dreamliner, proved to be a flop with airlines.

The market for such 200-to-350-seat jets is estimated to be in the thousands, compared with 149 net sales for Airbus’ A380 super-jumbo jet. Deliveries of the 555-seat aircraft have been pushed back about two years because of technical problems.

“EADS has taken the right decision,” French Transportation Minister Dominique Perben said in a statement. “The commercial success of European civil aviation depends on maintaining a full range of latest-generation aircraft ... to meet very strong growth in traffic expected in coming years.”

The go-ahead to build the plane is a victory for Airbus Chief Executive Louis Gallois, who salvaged the project from management turmoil and collateral damage to Airbus finances from the A380’s production issues.

It also completes a U-turn for Airbus, which once dismissed the mid-size market to gamble on size with the A380.

EADS said the “extra-wide-bodied” A350 would be delivered to customers starting in 2013 -- about five years after the first 787 is expected to enter service -- but promised it would be “a step ahead of its competitor.” It will be wider than a 787 though narrower than the 777, another Boeing competitor.

EADS did not disclose the development cost estimate. Industry analysts put it at about 10 billion euros ($13 billion), compared with an original budget of just over 4 billion euros.