Airbus SAS (EAD), which had record orders in 2011 to extend its lead over Boeing Co. (BA), said demand for its new aircraft will likely drop by more than 50 percent this year as an initial flurry of A320neo purchases wanes.
The European planemaker won 1,419 orders last year, beating its previous high of 1,341 in 2007, the Toulouse, France-based company said today in a presentation. Airbus, a unit of European Aeronautic, Defence & Space Co., delivered a record 534 planes, ahead of budget, and predicted deliveries will rise to 570 aircraft in 2012.
The introduction of the A320neo with more efficient engines unleashed demand from airlines seeking planes that burn less fuel, helping extend Airbus’s lead over Boeing to a ninth year. The U.S. planemaker had a net order tally of 805 planes and deliveries of 477 planes. Both companies boosted production as demand from Asia, particularly China, offset a slowdown in the mature aviation markets of the U.S. and Europe.
“Airbus’s record intake is the result of our strategic decision on the A320neo,” Airbus Chief Executive Tom Enders said in a presentation. “However, the continuous ramp-up to unprecedented production rates on all programs will demand a strong focus on the supply chain and our own delivery capabilities.”
Airbus and Boeing face the challenge of increasing production and driving sales in an environment where component suppliers and airlines are encountering financing hurdles amid the debt crisis.
EADS was little changed in Paris as of 11:16 a.m., after rising as much as 1.3 percent earlier. The stock has advanced 8 percent in six months, compared with Boeing’s 7.3 percent gain.
Enders is the most likely candidate to succeed retiring Louis Gallois as CEO of EADS. Gallois today urged investors to be patient on the succession plan, saying it may not happen right away.
EADS will have a significant improvement in profitability this year, Gallois said.
Airbus, which claims a 64 percent market share, expects to win about 650 orders in 2012, according to Chief Operating Officer John Leahy. Only 4 percent of last year’s deliveries went to North American carriers. The Asia Pacific region accounted for 32 percent, and Europe 23 percent. Companies that lease planes took delivery of 22 percent of the total.
Boeing Gathers Steam
Boeing is poised to outpace Airbus in orders this year, Leahy said. The U.S. planemaker introduced a fuel-saving version of the single-aisle 737 1 1/2 years after the introduction of the neo, and demand for the 737 MAX is gathering pace, Leahy said.
Boeing opted for the upgrade last year rather than an all- new successor to the 737 NG amid questions about manufacturing capabilities and competitive pressure from the A320neo.
For Airbus, Enders is increasing production to 42 single- aisle planes a month by the end of 2012, and 10 wide-body A330 planes by 2013. The planemaker is still studying whether component makers are in a position to meet a 44-unit target rate without putting strain on the supply chain and causing delays.
Airbus pushed back the A350’s service entry by as much as six months on Nov. 10, the project’s second delay, saying some parts were arriving late. Production delays caused Boeing to miss delivery goals for new 787 and 747-8 models last year. The 787 was more than three years late when the first plane was turned over to All Nippon Airways Co. in September.
Production rates of the flagship Airbus A380 double-decker jet are also on the increase, with 30 deliveries planned for this year versus 26 in 2011.
Airbus’s tally from last year doesn’t include orders won from AMR Corp.’s American Airlines (AAMRQ), which filed for bankruptcy protection after placing orders with both Airbus and Boeing. Though American Airlines Chief Executive Officer Tom Horton has pledged to follow through on the orders, it may take several years for the carrier to be in a legal position to buy them, Leahy said.
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