Boeing blow as bulk order from Chinese airlines goes to Europe’s Airbus
Airbus has secured a bulk order for 292 of its A320 single-aisle aircraft from four Chinese airlines, as deteriorating United StatesChina relations tipped the balance for aviation sales in the European manufacturer’s favour, dealing a blow to the American rival Boeing.
China Southern Airlines, Air China, China Eastern Airlines and Shenzhen Airlines were the four carriers buying the aircraft, Xinhua News Agency said.
Details of how the bulk order would be allocated and the price paid for each aircraft were not immediately available.
The bulk order came close on the heels of China Southern’s decision in May to scrap more than 100 of Boeing’s 737 MAX aircraft – the direct competitor to A320 – from its fleet plan, as the nation’s largest carrier cited “uncertainty over deliveries”.
The Guangzhou-based airline, the first to ground the 737 MAX in 2019 after back-to-back fatal crashes over five months by other carriers in Indonesia and Ethiopia, will reduce deliveries from Boeing to 78 planes through 2024, from 181 during a March forecast.
The A320 aircraft, a single-aisle jet that can carry between 150 and 180 passengers, is listed at US$101 million each. Bulk purchases are entitled to steep discounts from catalogue prices, and the aviation industry’s rule of thumb halves the total list price for an estimate of the order’s value.
China’s state-owned airlines had 2,070 Airbus jets in their combined fleet at the end of May, according to the Chinese civil aviation regulator.
The decision to add more Airbus planes over Boeing tips one of the most lucrative bigticket deals in global commerce in Europe’s favour, taking it off the negotiation table as the US and China remain mired in trade disputes left over from the era of former president Donald Trump.
US-China relations are at their lowest point in more than four decades as disputes rage over a range of issues from the trade war to tension over the Taiwan Strait and the South China Sea.
“As a top US exporter with a 50-year relationship with China’s aviation industry, it is disappointing that geopolitical differences continue to constrain US aircraft exports,” a Boeing official said.
The planemaker reportedly continued to urge a productive dialogue between the governments of the US and China.
China Eastern’s choice may be more immediate.
The Shanghai carrier is still investigating the cause of a fatal crash of flight MU5735, a service flown on Boeing’s older workhorse aircraft 737-800, which killed all passengers and crew on board when it crashed into the mountains of Guangxi region in March.
The bulk order showed how China – the world’s second-largest aviation market after the US – was showing “momentum” in its recovery from the travel slump caused by the Covid-19 pandemic, Airbus said.
China is the fastest growing aviation market for both Airbus and Boeing, where both manufacturers have established finishing assemblies – Airbus in Tianjin, Boeing in Zhoushan – to assemble the aircraft closer to their customers.
They must also compete with China’s ambition for a piece of the global aviation market via the locally assembled Comac C919, which completed its first predelivery test flight in May.
“These new orders demonstrate the strong confidence in Airbus from our customers,” Airbus’ chief commercial officer Christian Scherer said.
There are signs that China’s strict control of international flight arrival over the past two years as part of Beijing’s attempt to contain the Covid-19 pandemic is gradually easing because of the economic costs involved.
The country’s biggest airlines such as Beijing-based Air China and Shanghai’s China Eastern had sunk into two straight years of losses by the end of last year.
The Civil Aviation Administration of China (CAAC) is in talks with its counterparts in Vietnam and Thailand to allow their respective airlines to increase passenger flights to two each week from one, according to media reports last month.
The CAAC said it was negotiating with selective countries to gradually increase regular international passenger flights.
It is disappointing that geopolitical differences … constrain US aircraft exports
A BOEING OFFICIAL