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Qantas, Airbus Cool New Aviation Crisis Talk

Friday 21/09/2018 - Source: Air Wise News


Qantas and Airbus sought to cool fears of deepening turmoil in the aviation industry on Friday as Australia's biggest airline took the first of 20 A380 superjumbos and pledged more expansion.

Qantas said it had not noticed any deterioration in bookings in its main network or its Jetstar low-cost subsidiary in the past four weeks, and said it was looking to buy more superjumbos and studying the future Airbus mid-sized A350.

The A350 lost out against Boeing for that size of plane two years ago when Qantas opted for 65 787 Dreamliners.

Qantas took delivery of its first A380, the world's largest airliner, at the end of a week of global financial turmoil which has raised new fears for an airline sector hit hard by high oil prices and which threatens order cancellations at Airbus and Boeing.

Among those directly caught up in the financial crisis was the world's largest aircraft leasing company by fleet value, International Lease Finance, a unit of AIG which had to be rescued by the US Federal Reserve to avoid collapse this week.

Airbus sales chief John Leahy sought to remove concerns over the company's largest customer.

"On Tuesday AIG was teetering on the edge and things were dire. Right now they are completely stable again and I don't see any problem," Leahy told reporters.

Analysts say a collapse or disorderly sale of profitable ILFC could have spread chaos among the world's airlines, many of whom rely on lease financing to purchase fleets.

Qantas is the third airline to take delivery of the A380 after Singapore Airlines and Emirates.

It will enter service from Melbourne to Los Angeles on October 20 and fly the Sydney-Los Angeles route on October 24. It is configured for 450 passengers including 14 in first class and 72 in business shaped in futuristic silvery-backed pods.

"We operate in some of the longest sectors in the world given our location and the A380 gives us the flexibility we need," said Alan Joyce, head of the JetStar subsidiary who has been appointed Qantas chief executive from November.

"We haven't even taken delivery of the first aircraft and already we are thinking of expanding. People were predicting the demise of legacy airlines but I think the opposite has happened," he said.

However with markets see-sawing wildly, he indicated that Qantas would think hard before pressing ahead with plans for a stock market flotation of its Frequent Flyer loyalty scheme.

"We would do the float if market conditions were right, and if they were wrong we wouldn't do it," he said, adding the board still planned to discuss it in September. "We are keen to do the IPO at some stage; it is just a question of timing."

Qantas and other customers have been hit by a two-year delay in deliveries due to problems in wiring the double-decker A380.

Airbus denied reports its target of 12 deliveries could be changed but seemed reluctant to rule that out. After parrying questions, Airbus chief executive Tom Enders said he was "ready to bet a magnum of champagne that we will deliver more than 11".

The Qantas plane is the seventh A380 to be delivered this year and the eighth since the first plane rolled off the assembly line at the end of 2017. Airbus plans to deliver another five this year including two more to Qantas.

"I hope we are not going to find out right now that there are more delays otherwise this ceremony would be very abruptly halted," outgoing Qantas chief executive Geoff Dixon quipped.

Dixon had signed the final deal to buy the first Qantas superjumbo over dinner with Airbus officials washed down with 68 year old Armagnac, distilled in the year he was born.

"When you look at this aircraft today, it is almost the perfect aircraft for long-haul travel and that is our DNA," he told a news conference in front of the plane named after Australian aviation pioneer Nancy-Bird Walton.


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