The key players in the aerospace world are headed to the suburbs of London next week, and I don’t know about you, but my crystal ball is seriously fogged.
Will Airbus announce that it is indeed going to scrap the A350 for an all new-jet to challenge Boeing Co.’s 787?
Will Boeing announce its first passenger jet order for the 747-8, or the 787-10?
And will someone address whether it is just coincidence that the new chief executive overseeing the fractured Airbus is a guy named Streiff? (It rhymes with “strife.”)
“It’s going to be weird,” said Teal Group analyst Richard Aboulafia. “There are two scenarios, well, maybe three.”
Settle in with a warm beer and a plate of bangers-and-mash, my friends. It’s going to be a strange ride in Farnborough.
You’ve no doubt heard by now that the longtime French captain of Airbus, EADS co-chief executive Noel Forgeard, was sent off last week for head butting his German teammates.
That has seriously scrambled Airbus’ plans for next week’s Farnborough Air Show.
According to Leeham Co. analyst Scott Hamilton, the team from Toulouse had planned on some big announcements at the show, the largest industry gathering of the year.
Airbus was going to announce plans to develop an improved A320, Hamilton wrote in a note to clients this week. The plane competes against Boeing’s 737; Airbus looks to improve its performance by about 5 percent.
Airbus also was expected to give an update about progress towards solving the delays on the A380, and announce a new freighter version of the company’s A330.
But the really big news was to be a final decision on the fate of the A350. Airbus was expected to confirm that it had finally decided to scrap its thrice-overhauled design in favor of an all-new model to counter the 787. Some are calling this the A370.
The announcement “was expected to include some orders and other statements to show strong support for the redesign,” Hamilton wrote.
With Forgeard gone (along with former Airbus CEO Gustav Humbert), all that’s up in the air. Some pundits say new Airbus chief Streiff wants more time to study the A350-A370 question before making a decision.
In Aboulafia’s thinking, it’s not essential for Airbus to announce a decision next week.
“A few weeks’ delay is understandable,” he said, given that CEO Streiff is new to the aerospace industry, having come over from French industrial conglomerate St. Gobain. “It depends on whether they mean a few weeks or six months.”
What Airbus does have to do, he said, is acknowledge that Boeing got it right by pursuing the mid-sized jet market with the 787, and commit to finding a way to compete with, and even leapfrog past, the new Dreamliner.
On the Boeing side of the airport, now’s the time to pile it on, Aboulafia said.
“If they’ve got arrows in their quiver, they should fire them,” he said. “Make understanding noises, but get out there and book orders.”
There’s only a 5 percent chance Airbus will come out on top at Farnborough, Aboulafia said, while there’s about a 45 percent chance Boeing will seriously wound Airbus next week.
Maybe A350 customer Qatar Airways will bolt to Boeing and buy 787s. Maybe Emirates will finally snub Airbus and place a 50- to 100-jet order that would include the first 787-10s. And maybe someone will step up and order the first 747-8 passenger jets.
All those would be “major kicks” to Airbus, he said.
Yet there’s an even chance that Airbus will hold its own next week, Aboulafia said – announcing a few solid orders, discussing solutions to its A380 problems and revealing that it’s close to a decision on the A370.
“It’s going to be a difficult show for EADS and Airbus,” he said. “Airbus … they’re at bay.”
Reporter Bryan Corliss: 425-339-3454 or corliss@heraldnet.com.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
