The biennial Paris Air Show kicked off on Monday with Airbus SE announcing orders for a new plane while archrival Boeing Co. struggles to contain the fallout from the grounding of its best-selling 737 Max narrow-body.
The Max’s troubles have overshadowed the multi-billion-dollar order chase that typically dominates the industry’s biggest gathering. With the Max idled since March after two deadly crashes, there’s uncertainty with customers and suppliers, as well as aircraft plans for the future. Order totals are likely to be lower than years past.
Here are the latest developments:
Airbus lifted the veil on its newest model, the A321 XLR, in a bid by the European planemaker to capture untapped demand for long-range flights on smaller planes.
The manufacturer, seeking to take advantage of rival Boeing’s grounded 737 Max, also announced orders for the long-anticipated jet.
Air Lease Corp. will take 100 Airbus planes, including 27 of the new XLRs and 50 of the new A220 acquired from Bombardier Inc. last year, confirming a Bloomberg News report.
Meanwhile, Boeing’s CEO mounted a robust defense of the Max, saying it can re-establish its position as a single-aisle workhorse for decades to come, as the company sorts through an in-depth review of the airframe design and its internal processes in the wake of two deadly crashes.
“The long-term, multi-decade strategy hasn’t changed,” Dennis Muilenburg said in an interview with Bloomberg Television.
Airbus is closing in on a major order for at least 100 of its newest narrow-body aircraft, according to people familiar with the matter.
Narrow body mega order
In a deal whose total could approach US$11 billion based on list prices, Air Lease is poised to purchase A220 models, the program acquired from Bombardier Inc. last year, as well as a long-range version of its A321neo, dubbed the XLR, that the European planemaker is set to announce at the show.
While the planes are on opposite ends of the Airbus narrow-body spectrum, a deal would mark a vote of confidence in both the stable mates from one of the industry’s most important players.
US President Donald Trump’s commerce secretary, Wilbur Ross, came to the show with a firm message for European governments: Pay your fair share in defense if you want the US to help protect you.
Nations such as Germany must do much more to meet a commitment to spend 2 percent of GDP on security, Ross told Bloomberg TV, adding that the US is prepared to do “quite a bit more” than its fair share to support NATO but that the Europeans need to “step up".
Ross also lit into European carmakers, saying they talk free trade but “practice protectionism.”
He amplified on the sidelines, pointing out that US tariffs on automobile imports are 2.5 percent, versus 10 percent in the EU.
“That’s a heck of a difference,” he said.
Airbus is poised to announce a $4.1 billion deal to sell 14 of its A330neo aircraft to Virgin Atlantic Airways Ltd., according to people familiar with the mater. The order will be for 14 of the bigger A330-900 variant, said the people, who asked not to be named because the details aren’t public. An announcement is likely later Monday at the Paris Air Show, they said.
For Boeing, plunged into crisis by the grounding of the 737 workhorse, the show will be an exercise in damage control. Unable to say when the new Max version of the jet will fly again after two fatal crashes in five months, the US firm must convince customers and suppliers alike that it has a strategy in hand to cope with all eventualities.
CEO Dennis Muilenburg, who acknowledged a mistake in communication around Max issues, is doing damage control. “We come to this air show focused on safety. We come to this air show with a tone of humility and learning,” he said in a pre-show briefing.
Trouble with the Max has slowed a decision on whether Boeing will move forward with a new mid-market aircraft, fitting into the gap between the narrow-body and larger twin-aisle airliners.
Airbus is aiming to fill some of that space, hinting that it will move forward with an extended-range version of its Max rival A320neo. But some airlines still want the so-called NMA.
Meanwhile, Airbus is already working on plans for its next narrow-body, suggesting it can bringing the world’s first hybrid-electric airliner to market, replacing the bread-and-butter A320neo narrow-body in the next 15 years -- a move that would mark a technological leap for the aerospace industry.
Airbus SE is putting its new chief operating officer to work reviewing its jetliner factories across Europe as the group looks to trim costs and simplify a convoluted industrial structure resulting from its formation via a merger of national players.
Michael Schöllhorn will examine plane-building activities in France, Germany, Spain and the UK with the aim of making them more efficient and identifying surplus operations, people with knowledge of the matter told Bloomberg News.