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Last Updated: Tuesday, 4 September 2007, 22:50 GMT 23:50 UK
Can Airbus make it big in Asia?
By Sharanjit Leyl
Business reporter, BBC News, Hong Kong

Just before dawn earlier this week, Hong Kong residents scaled the heights of one of the city's tallest peaks to await a spectacle.

Airbus A380 flying over Hong Kong's Victoria Harbour
Airbus wants to drum up more Asian business

After an hour or two of anticipation, they were rewarded by the sight of something they had never seen before: the biggest passenger aeroplane in the world, flying above Hong Kong's Victoria Harbour on Monday morning.

It was all part of a publicity ploy from European manufacturer Airbus, which makes the A380.

The flight follows more than a year of bad publicity brought on by production delays.

There was more embarrassment just two days before the aircraft's arrival for Asia's largest airshow in Hong Kong. The plane that made Monday morning's flight had scraped its wing in Bangkok and had to have its wingtips removed.

John Leahy, Airbus's chief operating officer for customers, admits it has not been a smooth ride.

"Every plane is difficult to build - the bigger the more difficult," he says.

"It's been a manufacturing nightmare to build it. Now we've got the production process solved. It took a two year delay, though."

Rivalry

Still, the plane has been a hit with locals. Despite several security barriers and long lines, many of the delegates at the Hong Kong Asian Aerospace show turned up to see just how big it was, both inside and outside.

But some critics say that the A380's sheer size and pulling power have not stopped it from lagging behind Boeing in Asia.

In China alone, for instance, 60% of the commercial planes are made by Boeing.

The American manufacturer did not fly down any of its planes to Hong Kong for display; instead, visitors to the airshow had to make do with plastic models at the manufacturer's exhibition booth.

China is going after Boeing and Airbus's low-end market
Jim Eckes, IndoSwiss Aviation

Larry Dickenson, a senior vice-president at Boeing, says he is confident of his company's lead over Airbus in Asia.

"They have a lot of ground... to recover," he says. "They are in a different situation from us, driven by different motivations.

"We have our plans. We have our planes. We have the products that the airlines and the world prefer."

Home-grown talent

But even as the two giants in plane manufacturing slug it out for a slice of Asia, one Chinese manufacturer already has lofty ambitions of its own.

Just a few steps from the Boeing booth at the show, China Aviation Industry Corporation 1 - otherwise known as Avic1 - has a display of its own aeroplane.

The ARJ21 is one of China's first passenger jets, capable of carrying nearly a hundred people.

Backed by the Chinese government, the manufacturer hopes to take on its western rivals.

Jim Eckes, an aviation analyst from IndoSwiss Aviation, thinks they may have a good chance.

"China is going after Boeing and Airbus's low-end market," he says. "They're displaying here on a par not quite as big as Boeing or Airbus - but they're here."




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