Additional upgrades might delay the launch of Airbus A330neo jet: report

Mumbai: Airbus Group has not decided whether it will launch its proposed A330neo jet at this month's Farnborough Airshow but is confident about the outlook for plane orders at the gala event, its strategy chief Marwan Lahoud said on Saturday.

Airbus has drawn up plans to revamp its biggest-selling wide-body passenger jet to preserve a second front in its competition with the delayed Boeing 787 Dreamliner in addition to the new A350. Lahoud said ‘the jury is still out’ on whether the A330neo, a more efficient version of the 20-year-old A330 jet, would be launched at the July 14-20 airshow.

"The subject is still being discussed," he told reporters on the sidelines of an economic conference in southern France.

People familiar with the matter say technical work on the project, based on a Rolls-Royce engine and new wingtips, is complete and that barring surprises, the $2 billion revamp will go ahead soon, subject to board approval. There will be two versions - upgrades of both types of A330, the 253-seat A330-200 and the 295-seat A330-300.

The board could discuss the issue before the airshow or at its next regular meeting tied to July 30 half-year results. The project has already led to a war of words between Airbus and Boeing that is expected to spill over to the world's largest aviation event, held each summer in the English town of Farnborough or in Paris - in alternate years.

The two companies are involved in a strategic chess game at the lower end of the market for long-haul jets, with tens of billions of dollars' worth of business at stake. However there are concerns that the arrival of the A330neo could spark aggressive price competition for new orders.

Airbus has said the A330neo would have the same "cash operating costs" and cost much less to buy than the Boeing 787-9, Boeing's latest model due to make its debut at Farnborough. Boeing disputes these assertions as well as Airbus's forecasts of more than 1,000 potential sales for the A330neo.

Lahoud said he was optimistic about the overall outlook for aircraft deals at the Farnborough Airshow. Asked how many orders he expected, he said: "We believe we'll have a good business dynamic ... we are pretty confident."

Airbus ended the first half of the year behind its U.S. rival in orders and deliveries, but is widely expected to unveil hundreds of new orders in Farnborough. Boeing, however, looks set to strike a blow against Airbus in its European home territory by convincing UK-based Monarch Airlines to switch suppliers as the two planemakers wage a global battle for market share for single-aisle jets like the Boeing 737 and Airbus A320.

Lahoud said Airbus Group would continue boosting the amount of raw materials and components it buys in dollars to offset the currency's weakness. It has offered some customers the chance to pay for aircraft in euros. "It is their decision," he added.

Airbus Finance Director Harald Wilhelm meanwhile told German newspaper Boersen-Zeitung most currency risks were hedged for the next 2-3 years. The company's guidance, based on a euro worth $1.35, "is not at risk" from currency swings, he said. He reaffirmed plans for the A380 to break even next year.