Airbus OKs production of 555-passenger jet

By JOCELYN GECKER

Associated Press

TOULOUSE, France – Airbus Industrie gave final approval today to a plan to build the world’s largest passenger plane, a superjumbo jet that will hold 555 passengers and can come with bars and casinos.

Airbus hopes the new double-decker A380 will give it a competitive edge over the Boeing Co.

“This decision heralds a new era in the history of flight, with the introduction into service of the world’s 21st century jetliner in early 2006,” the company said in announcing that its supervisory board approved the plans today.

So far, Airbus has received 50 firm orders and 42 options for the superjumbo, which will have larger cabins, more floor space and staircases, and can be equipped with bars, casinos and lounges.

“We cannot be more proud of the product we developed,” Manfred Bischoff, chairman of the Airbus supervisory board, said. “We intend to once more set a standard for quality and efficiency.”

The board gave the green light for the $12 billion project at its headquarters in Toulouse in south-central France. The board is made up of top executives from the two companies that are the sole shareholders in the consortium – European Aeronautic Defense and Space Company, with an 80 percent holding, and Britain’s BAE Systems, with 20 percent.

The superjumbo will be a direct challenge to Boeing’s dominance of the long-haul, high-capacity market with its fleet of 747s, and it intensifies the rivalry between the two manufacturers, who are banking on conflicting forecasts for air travel in the 21st century.

Airbus says the demand for larger planes is set to grow. It forecasts that the number of airliners in service with 400 seats or more will rise to 1,235 over the 20 years.

Boeing argues that airlines are more interested in smaller planes with the range to bypass major hubs on nonstop flights to mid-sized and smaller cities. Boeing’s biggest jet at the moment is the 747-400, which can carry 416 passengers.

“The announcement today is just another indication of how dynamic the commerical jet transport market is right now,” said John Dern, a Boeing Commercial Airplane Group spokesman in Seattle.

“Airbus is taking one strategic approach and Boeing is taking another, and time will tell,” he said.

“All we can do is what we hear the airlines are telling us and what the data is telling us about how new routes are developing. Passenger preference is for direct nonstop service.”

In 2000, Boeing committed to produce longer-range versions of its 767 and 777 jets, designed to make non-stop flights to smaller cities. This year it received 117 orders for the 777. Boeing also has plans for a stretch version of its 747 jet to seat some 520 people. It has not yet received any orders for the new jet, which it estimates will cost between $4 billion and $6 billion to develop.

Airbus officials had said they needed around 50 firm orders to make the A380 project economically viable – a target it met Friday when Virgin Atlantic Airways announced an order for six jets and options on six others in a deal worth more than $3.8 billion.

The biggest A380 order – 12 planes – came from Australia’s Qantas Airlines Ltd., a Boeing client for more than 40 years. Other firm orders have come from Singapore Airlines, Air France, Emirates Airlines, and the International Lease Finance Corp. Germany’s Lufthansa AG and British Airways are in talks about buying the plane.

Airbus has been gradually closing the gap on Boeing since its creation in 1972, and last year reported significantly more aircraft orders.