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Boeing, Airbus find that buyers are tentative

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Associated Press and Herald staff
Published:
FARNBOROUGH, England -- European aircraft manufacturer Airbus has announced its only firm order so far at the Farnborough International Airshow, on the third day -- a further sign that airlines are concerned about the global economic outlook.
And with governments around the world cutting costs, many airlines appear to be taking a wait-and-see approach, especially compared with last year's air show in Paris.
Airbus, a subsidiary of EADS, did get a firm order from the aerospace division of CIT Group, a transport finance and leasing company, which has ordered 10 mid-sized long-haul A330 aircraft in a deal that has a list value of $2.3 billion, although companies rarely pay list price.
The deal includes five that were ordered earlier this year, and deliveries are scheduled to begin in 2014. With this new order, CIT now has a total order book of 162 aircraft scheduled for delivery through 2019, of which 89 are for Airbus aircraft.
Chicago-based Boeing Co., meanwhile, said Wednesday that it agreed with Avolon Aerospace Leasing on a deal for as many as 30 737s.
Though the first two days of this year's airshow were littered with some headline-grabbing orders, many of the deals announced have been commitments, including Boeing's $9.2 billion deal with GE Capital Aviation Services, the commercial aircraft leasing and financing arm of General Electric. Most commitments do become firm in the end but uncertainties remain.
That trend of failing to close out deals continued Wednesday. Alongside its deal with CIT, Airbus revealed that China Aircraft Leasing, a fast growing Hong Kong-based company, has committed to buy 36 current-generation A320 aircraft in a deal with a list value of $3.1 billion.
Earlier this week, Airbus revealed plans to overhaul its A330 line to give it greater range. By giving the plane the ability to carry more fuel -- combined with greater efficiency -- Airbus said the A330-300 will be able to make longer journeys. For example, Seattle would be accessible from Beijing, as will Tokyo from London.
The only deal Boeing announced Wednesday was a commitment by Irish-based leasing company Avolon to purchase 10 737 MAX-8s and five 737 MAX-9s, as well as 10 737-800s. The commitment for the A320's big rival has a list-price value of $2.3 billion.
"Avolon has a significant and strategic role to play in the aviation finance industry and we welcome them as one of the launch lessors of the 737 MAX," Ray Conner, president of Boeing Commercial Airplanes, said in a statement.
Boeing already has announced significant orders for the 737 MAX at the air show. An order from United also is expected to be announced this week.
Story tags » 737Airline OrdersAirbusAerospace

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