Airbus Said to Move Toward A330neo Launch at Air Show

Airbus Group NV (AIR) is preparing to announce more fuel-efficient engines for its A330 jet at the Farnborough Air Show next week as it seeks to extend the popular wide-body’s lifespan, people with knowledge of the plans said.

The planemaker wants to introduce the revamped Neo model at the world’s largest aviation expo, said the people, who asked not to be identified because details are private. Airbus has lined up enough early buyers to proceed, including AirAsia Bhd (AIRA) and several lessors, two of the people said, though a final go-ahead requires board approval.

Building an upgraded variant of the twin-aisle A330 would echo Airbus’s approach in re-engining the narrow-body A320 into the A320neo, which has become the fastest-selling jetliner in history. While the A330 lacks the cutting-edge technology of Boeing Co. (BA)’s carbon-fiber 787 Dreamliner, the Airbus jet is cheaper to purchase after being in service for 20 years.

An Airbus spokesman said yesterday the Toulouse, France-based company had no comment ahead of an official decision. The Farnborough show in England begins July 14.

Airbus negotiated with Rolls-Royce Holdings Plc (RR/) and General Electric Co. (GE) about powering the plane and has settled on offering engines solely from Rolls-Royce, two of the people said. A spokesman for the London-based company declined to comment.

Photographer: Paul Thomas/Bloomberg

A banner advertises an Airbus A320 neo in the A320 wing assembly section of the company's factory in Broughton, U.K. Close

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Photographer: Paul Thomas/Bloomberg

A banner advertises an Airbus A320 neo in the A320 wing assembly section of the company's factory in Broughton, U.K.

The current A330 has a choice of engines from Fairfield, Connecticut-based GE, Rolls-Royce and the Pratt & Whitney unit of United Technologies Corp. (UTX), though Rolls-Royce has won 80 percent of orders in recent years.

Production Slots

Airbus has open production slots for the twin-engine A330 starting in 2016. The costlier of the plane’s two passenger versions lists for $245.6 million, while the most-expensive 787 retails for $288.7 million, according to the planemakers’ price lists. Buyers typically get discounts.

Rejuvenating the A330 may make the aircraft a viable alternative to Airbus’s planned A350-800, which has been selling poorly and losing orders to the larger A350-900. Airbus has encouraged customers to select bigger, more expensive versions of its latest wide-body, which will be handed over to the first commercial customer this year.

John Leahy, Airbus’s chief operating officer and lead salesman, said in June that the company could sell more than 1,000 A330Neos were the plane to go ahead.

Buyers could include carriers operating transcontinental U.S. routes and services across the Atlantic which need planes quicker than the 787 is available, as well as Sepang, Malaysia-based AirAsia, where Chief Executive Officer Tony Fernandes says an updated A330 would be a “killer” model that would make long-haul discount flights viable.

To contact the reporters on this story: Andrea Rothman in Toulouse at aerothman@bloomberg.net; Julie Johnsson in Chicago at jjohnsson@bloomberg.net

To contact the editors responsible for this story: Benedikt Kammel at bkammel@bloomberg.net; Ed Dufner at edufner@bloomberg.net Ben Livesey

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