Airbus Wins Singapore Air Order, Builds Momentum

Update4 from Bloomberg -- Airbus SAS, the world's largest maker of commercial aircraft, won a $3.7 billion contract from Singapore Airlines Ltd. for 20 new A350s on the last day of the Paris Air Show, capping a week of gains over Boeing Co.

The Toulouse, France-based planemaker swept a record 425 firm orders valued at $61.7 billion at the show, twice as much business as it gained at last year's major industry event. Boeing won only one 50-plane order for the midsize 787 Dreamliner, which competes with Airbus's new 300-seat plane.

``A lot of the orders they booked were for the A350,'' said Zafar Khan, London-based analyst with Societe Generale. ``When you launch an aircraft, you tend to get lots of orders. Launch customers get very attractive deals.''

Airbus lost a five-year lead in orders to Chicago-based Boeing in 2006 as several A350 redesigns left the planemaker without a strong offering against the Dreamliner. The company was hobbled by its bet on the 555-seat A380, which is two years late and will cut profit at parent European Aeronautic Defence & Space Co. by 4.8 billion euros ($6.4 billion) through 2010.

Shares of EADS rose 34 cents, or 1.4 percent, to 24.10 euros in Paris. The stock has fallen 7.7 percent this year compared with a 7.9 percent gain for Boeing.

Passing Boeing

The European planemaker overtook Boeing in terms of the number of planes ordered this year. Based on the sum of its May 31 total and announcements at the show, Airbus has at least 626 orders on its books. Boeing announced 66 new orders at the show altogether, taking its year-to-date total to 510 as of June 20.

``Our longstanding policy is not to store up order announcements for an air show,'' Boeing said in a statement. ``We used the show to confirm that the 787 Dreamliner remains on schedule for first delivery in May 2008.''

Airbus this week also won non-binding commitments, or preliminary orders, for an additional 303 planes worth an estimated $37 billion at list prices.

``The air show has confirmed that Airbus is very much back on the market,'' Chief Executive Officer Louis Gallois said today in a statement.

Airbus aims to convert all this week's non-binding orders into contracts by the end of the year, Airbus Chief Operating Officer John Leahy said in an interview. Achieving that goal would bring Airbus about 930 firm orders in 2007.

Firming Orders

``We will firm up all these MOUs by the end of the year,'' Leahy said, referring to the memoranda of understanding in which order commitments are expressed.

New Airbus orders this week included 141 firm contracts for the A350 XWB, taking the total order book for the planned mid- sized airliner to 154, approaching the 200-plane target the company set for itself for the year. That compares with 634 orders Boeing has for the 787, scheduled to enter service in 2008, five years before the Airbus plane.

Besides the Singapore Airlines contract, major Airbus contracts included a $19.3 billion Qatar Airways order for 80 A350 XWBs and three A380 superjumbos and $4.8 billion in OAO Aeroflot deals for 22 A350s and five single-aisle A321s.

The highlight of Boeing's show was a June 19 order from International Lease Finance Corp., the world's biggest aircraft leasing company, for 50 787s and 10 737s.

``While Airbus certainly had the quantity, I'd put the ILFC 787 order down as the quality order of the show,'' said Doug McVitie, managing director of Arran Aerospace, a Dinan, France- based consulting firm. ``If ILFC had chosen the A350 instead, that really would have been champagne time for Airbus.''

By Andrea Rothman and Laurence Frost
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