Tue, Nov 14, 2017 - Page 10 News List

Emirates puts pressure on Airbus to commit to A380

Bloomberg

Emirates president Tim Clark stepped up pressure on Airbus SE to commit to its slow-selling A380, suggesting that even a widely expected follow-up order from the Gulf carrier might not be enough to keep the program alive into the next decade.

Clark, speaking at the Dubai Airshow where he on Sunday ordered Boeing Co aircraft valued at US$15.1 billion, said his airline is able to accommodate more A380s beyond the 142 on order.

However, Clark said Emirates “needs to see something” from the Airbus board that reflects the company’s backing of the program before it buys any more.

Even if a fresh deal materializes, it is for Airbus management to decide if that is enough to keep the plane alive, he said.

“If we order any more, we want to make absolutely sure that the will is there contractually to continue the line for 10 to 15 years,” Clark said, adding that Airbus “would like to put more aircraft into us and everyone else, but their board might have a view that says ‘If you don’t sell any more, Emirates or no Emirates, we don’t want you to do it,’ so we need to see something from them which says ‘We will do this.’”

While Clark said there is “no leverage” in his relationship with Airbus, his position as by far the biggest — and for now the only remaining — buyer of the A380 shows his bargaining power with the European manufacturer.

Still, Airbus has already pushed back on new engines for the A380, one of Clark’s key demands, saying there is no business case at present as the order book starts drying up. Emirates has 42 A380s due for delivery, after taking its 100th double decker earlier this month.

Airbus is still hoping for a fresh A380 deal at the Dubai Airshow. The company is negotiating a follow-on accord for about 36 units, people familiar with the talks said.

The signing ceremony at the Dubai show on Sunday was widely expected to be for that aircraft, until Boeing pulled out a surprise deal for 40 787-10 Dreamliners. Airbus did not unveil any orders on the first day.

Clark said the Boeing aircraft fulfills the role of serving city pairs, pairs that Emirates’ largest models — the A380 and the Boeing 777 — are too big to handle. He said the plane also offers superlative operations to Airbus’s competing A350, which Emirates had originally ordered and then canceled again in 2014.

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