Date
20 September 2017
Qatar Airways has put the blame for the cancellations squarely at the feet of Airbus. Photo: Reuters
Qatar Airways has put the blame for the cancellations squarely at the feet of Airbus. Photo: Reuters

Airbus in US$1 bln dilemma as Qatar cancels four jets

Qatar Airways has axed orders for four A350s because of delivery delays, handing the European planemaker a new headache over what to do with jets worth US$1.2 billion, Reuters reports.

The cancellations came as Airbus struggles to close a sales gap with rival Boeing Co.

The decision means Airbus will have to try to resell or reallocate the 283-seat jets at a time when demand for big planes is softening, and could cost Airbus US$60-80 million to rip out and replace interiors designed to fit the airline’s plush brand.

“Smart players are not going to rush in, because other cancellations or deferrals may come,” said veteran aircraft financier Bertrand Grabowski, former board member at DVB Bank.

The move follows concerns about delays and quality problems on cabin equipment for the A350, but also comes at a time when Qatar is entering the second month of a crisis caused by a ban on Qatar’s use of the airspace of four Arab nations.

Qatar Airways chief executive Akbar Al Baker said earlier any delays were the planemaker’s responsibility.

“We are asking Airbus to deliver it faster,” he told a Dublin news conference. “The delay is from Airbus.”

An Airbus spokesman said the cancellations were related to “known supply chain issues”. Asked what would happen to the undelivered A350-900 jets, he said: “They will be reallocated”.

Qatar Airways has a reputation for being demanding when reviewing aircraft for quality defects before delivery.

However, some analysts have said the Gulf political crisis may give the airline a further incentive to slow deliveries, compounding the impact of relatively weak oil prices.

“All the Gulf carriers realize they have ordered too many wide-bodied aircraft and don’t have room for them, especially now,” said an aircraft finance industry official.

Al Baker last month denied the Gulf spat would interfere with Qatar Airways’ growth or aircraft deliveries.

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RA

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