Emirates Said Negotiating Order for About $16 Billion of A380sNovember 11, 2017
Emirates is negotiating a deal to purchase about 36 additional Airbus SE A380 superjumbos, according to people familiar with the talks, a move that would help extend the embattled program’s life.
Executives are working to seal an accord with the goal of making a formal announcement on Nov. 12 when the biennial Dubai Air Show kicks off, said the people, asking not to be named as the discussions are confidential. An order for that number would be valued at $15.7 billion at current list prices, though the tally could change as talks enter the final stage.
Airbus has been working to secure a follow-on order for the four-engine model from Emirates, which would add another 4 1/2years to its backlog, after the planemaker was forced to cut production of the aircraft to just eight a month next year from 25 in 2016 amid slack demand. Outgoing sales chief John Leahy, who is looking to Emirates for a last triumph before handing over the reins to a successor early next year, is renowned for getting orders signed in the final moments ahead of an air show.
An agreement with Emirates would allow Airbus to continue marketing the plane, pursuing a series of smaller deals that wouldn’t otherwise have been viable without the new commitment from its biggest customer for the double-decker model. Representatives for Toulouse, France-based Airbus and Emirates, which is based in Dubai, declined to comment.
The planemaker in June unveiled an upgrade to the A380, dubbed the “plus” that adds wingtips and a more condensed cabin layout to improve the fuel efficiency of the aircraft. Airbus Chief Executive Officer Tom Enders restated the company’s commitment to the plane in Hamburg this month when Emirates took its 100th jet of a total 142 on order.
Emirates already represents the only major customer for the double-decker, which has 317 net orders in total. Most other customers, such as British Airways to Lufthansa to Air France, have made the plane only a sub-category of their fleets or even cut back their original commitments.
Reuters earlier reported that talks were centering around a deal for between 36 and 38 planes, citing a person familiar.