Airbus positive as Boeing gets nose in front
AIRBUS has held on to the top spot for more than a decade and Boeing overtaking it will come as a major blow. As reported in The Post Airbus, which has a major research and development base in Filton, has announced a string of multi-million orders in recent months.
But despite the raft of announcements and orders Airbus has still been usurped by American rival Boeing in the race to become the world's leading airplane manufacturer.
To make the situation even harder to swallow industry experts believe that Boeing is likely to maintain its position at the top of the pile for at least another three years.
However, just yesterday a new Airbus order was announced worth an estimated £2 billion by Singapore based BOC Aviation for the purchase of 50 A320 aircraft. The latest deal follows a series of multi-million deals in recent weeks.
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John Leahy, the man who brokered the deal for Airbus, said: "The announcement from BOC Aviation is a vote of confidence in the long-term appeal of our popular A320 family.
"It works well for the financial community thanks to its wide operator base, its excellent operating economics as well as strong residual values. With this latest order for A320 family aircraft, BOC Aviation is well placed to continue to build on its pos- ition as a top tier leasing company."
The announcement came just days after a low-cost Indonesian airline ordered 25 of its planes in a deal estimated to be worth £1 billion. And in the run-up to Christmas the firm announced it had landed a £5billion deal with Singapore Airlines. The airline announced it is to order five super-jumbo Airbus A380 aircraft and 20 more A350 planes in a deal valued at $7.5 billion – about £5bn.
That mega deal was quickly followed by the announcement that AirAsia had ordered 100 A329neos which are part-designed in Filton in South Gloucestershire. The deal, worth an estimated £5 billion, was announced by David Cameron – who said it would help to safeguard 9,000 in the UK's aviation industry.
Just this week Emirates, the world's biggest airline announced it is looking at ways of taking on 30 more A380 super-jumbos as demand for international flights increases.
Airbus has seen major changes and some disappointments over the last 12 months but despite losing its place at the top of the pile it is still upbeat about the future. Earlier this year the management structure changed at the top with chief executive Tom Enders moving to parent firm EADS.
Fabrice Bregier, the man in charge of the Power8 cost-cutting programme, has taken up the reins as chief executive of Airbus.
The firm was involved in one of the biggest takeover sagas of the year when it emerged that parent company EADS was involved in negotiations with BAE Systems.
If the multi-million merger had taken place, the deal would have created the biggest aerospace company in the world.
It led to headlines across the world but fell apart after just a few months under the weight of political pressure from Governments across Europe. The fact that the French and German government demanded assurances over jobs finally led to BAE Systems and EADS pulling the plug on a deal which could have been a major turning point for the global aviation sector.
The news that the deal had collapsed was quickly followed by the closure of historic Filton Airfield.
In many people's eyes the airfield is symbolic of the aviation industry in the UK and was the first place in the country where aeroplanes were manufactured.
The home of Concorde and the Brabazon was closed after more than a century by BAE Systems after the firm announced it was no longer financially viable.
Days before the airfield closed it emerged that BAE Systems had struck a land deal with a property developer worth £120 million.
Until the site's closure Airbus had been its biggest user, but despite constant rumours the firm has always insisted it has no plans to move out of Bristol. It employs around 4,000 people at its Filton site and another 10,000 workers in the surrounding area rely on the aviation sector.
Manufacturing may be coming to a halt at Filton, but the plant is fast becoming a centre for design and research. Airbus has made a major investment in a new training centre.
Boeing is being widely tipped to release official delivery figures by the end of the month showing it supplied its airline customers with around 600 aircraft last year against an Airbus forecast of 580.
The figures will be the first time since 2002 that Airbus has lagged behind Boeing and the figures are largely down to the long awaited launch of the 787 Dreamliner.
The new plane has suffered delays and technical hitches but is still expected to be the biggest seller of the year. The A350, Airbus' rival to the Dreamliner, has been hit by similar delays. First deliveries of the A350 are not expected until early next year.
Airbus is only due to deliver the first of its planned A350 wide-body aircraft in 2014 several years later than originally planned.
Nick Cunningham, analyst at Agency Partners, is predicting that the two manufacturers will cut production after 2015 , when global demand begins to slow down. Despite the global recession the aviation industry has remained relatively unscathed in comparison with other sectors such as car manufacturing and construction. "Aircraft orders have either peaked or are about to peak for Airbus and Boeing, and the historical trend tells us that the peak in aircraft deliveries will follow within two or three years," he said.
In the 11 months to November 30, Boeing delivered 537 aircraft to customers, while Airbus supplied 516.
Boeing's shares rose just 3 per cent in 2012, amid concerns about whether it could increase aircraft production – particularly the 787 – without glitches. EADS' shares, by contrast, rose 22 per cent, as Airbus improved its underlying operating margin to 3.3 per cent in the nine months to September 30, compared with 1.3 per cent in the equivalent prior period.
Airbus is set to announce its annual results later this week. Analysts are expecting the results to be positive despite the changes that have taken place over the last 12 months.