Airbus Says Possible A380 Delay Next Year

[Gerald A]

May 6, 2008

Dubai airline Emirates, the biggest customer for Airbus's A380 aircraft, said the European plane maker notified that it may face further delays in the delivery of the world's largest passenger plane.

"It's very serious," Emirates President Tim Clark said in Dubai on Tuesday. "This will do us serious damage."

Airbus sent a letter to Emirates informing it of possible delays in its "wave 2" delivery of the A380. This would apply to A380s being delivered to Emirates in April next year, Clark said.

"We'll know in two to three weeks if it's ok or not," Clark said. Airbus did not explain why the deliveries could be delayed, Clark said.

Emirates expects to receive four A380s this year, one before the end of March 2009 and another 12 in the year to March 31, 2010.

Airbus declined to comment.

(Reuters)

Gerald

[Andrew M]

Hmm well makes sense since the rumors the other week about possible delays.

Looks like my A380 flight in January MEL-LAX might not happen.

Going to call QF now to assign my seats for the 744ER

[Rhys Xanthis]

It still might...ive heard the first is undergoing fit out in hamburg

[Gerald A]

May 13, 2008

Airbus announced another delay in deliveries of its A380 superjumbo on Tuesday, deepening the woes of Europe's biggest industrial project and risking further penalty payments to airlines.

Airbus said it was unable to boost production as quickly as it hoped as it tries to recover from two years of production delays caused by problems in installing the wiring on the world's largest passenger plane.

"As a result, Airbus plans now for 12 (instead of 13) deliveries in 2008 and 21 (instead of 25) in 2009. Details about the new plan and the further ramp-up and delivery slots in 2010 and the following years will be discussed with customers in the coming weeks," it said in a statement.

It gave no details on the financial impact of the latest delays to the aircraft, already two years behind schedule.

It was the fourth time Airbus had announced delays in delivering the 525-seat double-decker plane. But damage to the production schedule was not as severe as some had expected.

"It's not a big surprise. The financial impact should also be minor but it's really hard to estimate," UniCredit analyst Stefan Halter said. "Given the number affected -- we are just talking about five planes -- the impact really should be minor.

Airbus commercial director John Leahy said he did not expect airlines to cancel orders as a result of the latest setback, but he faces talks over possible penalty payments and rescheduling with airlines, which are increasingly outspoken about delays.

Previous penalties helped push Airbus into loss last year.

Tim Clark, the powerful head of Emirates -- by far the biggest A380 customer with 58 ordered -- has warned the airline faced "serious damage" from further delays.

Airlines due to receive A380s in 2008 and 2009 include Emirates, Singapore Airlines, Qantas, Air France and Lufthansa.

The fresh setback to the A380 came days after Airbus was forced to scrap plans to sell some of its factories to attract investment in new materials for the A350, a future mid-sized jet.

It also came weeks after Airbus announced a major review of production on the A380.

Airbus said last week Chief Executive Tom Enders had written to all A380 customers telling them production had reached a critical phase.

The A380 went into service last year with Singapore Airlines. Four planes have been delivered with 17 in various stages of production.

The aircraft sells for USD$300 million at list prices and the planemaker is paid most of that when the jets are delivered.

The mammoth pan-European venture has faced repeated setbacks since mid-decade. It was first delayed in 2005, and in 2006 sections began reaching the French assembly plant from Germany with wiring flaws that caused production to halt.

Then Airbus pulled together a labour-intensive process for effectively wiring the first 25 planes by hand, with teams of engineers organizing wiring bundles on long tressle tables at the assembly plant in Toulouse, southwest France.

A second wave of production will use a new automated industrial process but Airbus is up to three months late in pushing aircraft through to this system, executives said.

"We are in a four-year recovery program. We have to make some progress but we are not back to square one," Enders said.

He said he was confident Airbus could produce and delivery 30 to 40 of the A380s in 2010 compared with the most recent published target of 45.

Senior Airbus executive Tom Williams said it would not be before the first quarter of 2009 that Airbus would know for certain how many planes it could deliver in 2010.

(Reuters)

Gerald