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Last Updated: Monday, 18 June 2007, 18:42 GMT 19:42 UK
Airbus order revives Boeing rivalry
By Jorn Madslien
Business reporter, BBC News, Paris air show

An Airbus A380 circles above the Paris Air Show with US and EU flags in the foreground
Rivalry between Europe and the US is palpable in Paris

Having just signed a deal that could signal the recovery of troubled aircraft maker Airbus, the chief executive of Qatar Airways knows full well he has thrown the cat among the pigeons.

"I think you should be delighted that we are paying $16bn (8bn) to a European company," Akbar Al Baker says.

"Today we are really putting ink on paper for the purchase agreement."

Ahead of the Paris air show, Airbus had failed to secure more than 13 orders for its mid-size, long-range A350 WXB, a rival to American aerospace giant Boeing's 787 Dreamliner, which had already clocked up 584 orders.

New confidence

We are at the beginning of a new story
Louis Gallois, Airbus chief executive

In placing an order for 80 of the expensively redesigned A350s, Qatar has revived the rivalry between the two companies, despite much talk of the Airbus plane's faulty design and delayed arrival in the market place.

"This project is taking off in the best way," declares a beaming Louis Gallois, chief executive of Airbus.

"Now we are at the beginning of a new story."

Having announced more than $45bn in orders during the first day of the show - equivalent to what analysts had expected from all the aircraft-makers here combined - it seems Airbus' deal-makers have defied gravity in a manner only matched by the A380 super-jumbo's spectacular air display.

The giant 555-seat aircraft still turns heads, two years after its first fly-over in Paris, though there are many who bemoan the fact that the big bird has yet to be delivered to customers.

The A380 delays, which have been caused by wiring problems, have cost Airbus dear and sparked concerns about the company's ability to deliver the A350 on schedule.

Scott Carson, senior Boeing executive
Boeing executives are confident about the Dreamliner

Mr Gallois is eager to ensure airlines that this time all is under control.

"We have learnt a lot [from the problems with the A380], and you can be sure we will take care of that," he says.

"I don't like the campaign right now that the [A350] aeroplane is not defined. It is defined, performance is defined, we are committed to achieve the performance, and we are offering guarantees to our customers."

No delays

Boeing's technologically advanced Dreamliner is set for a debut on 8 July and "we expect to deliver the first 787 in May next year", Scott Carson, head of Boeing's commercial airplanes division, tells BBC News in an interview.

Airbus lags far behind, with an estimated arrival date of 2013.

AIRCRAFT DELIVERED IN 2006
Airbus: 434
Boeing: 398

But at this stage the choice between the two aircraft has become easier for buyers since Boeing's swelling order book means it is operating a waiting list for new orders.

In other words, regardless of which plane a carrier was to choose at this stage, they would probably not take delivery till 2013 in any case.

Consequently, the two aircraft makers are back on a level-playing field as they vie for the attention of Emirates, which is planning to place an order for 100 aircraft.

The airline says it will place the entire order with just one of the companies, choosing either the A350 XWB or the 787 Dreamliner.

"We've got some talking to do to both Boeing and Airbus with regard to the commercial terms of the deal," says Emirates president Tim Clark.

"But I think we're in a good position to make an aircraft decision in the next few months.

Some observers say Qatar could also be in the market for more aircraft, though when asked whether he would be placing orders with Boeing anytime soon, Mr Al Baker remains mum.

"You get Mr Gallois worried when you talk about Boeing," he quips. "You shouldn't be talking about Boeing here."




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