Bloomberg News

BA’s Walsh Says China Jet a Threat to Airbus, Boeing After Visit

October 18, 2011

Oct. 18 (Bloomberg) -- Willie Walsh, chief executive of British Airways parent IAG, said he examined China’s plans for a new single-aisle plane during a recent visit there and that the project represents a serious rival to Airbus SAS and Boeing Co.

The executive met with Commercial Aircraft Corp. of China in Shanghai about six weeks ago and was shown blueprints for the 168-seat C919 jet it aims to make by 2016, he said today in an address to engineers in Toulouse, France, where Airbus is based.

“My view is you have a real competitor,” Walsh said. “The C919 looks very good on paper. There’s a lot of improvement in fuel consumption and environmental performance.” He didn’t say whether his company is considering placing an order.

British Airways, which merged with Spain’s Iberia in January to form International Consolidated Airlines Group SA, signed a memorandum with Comac at the 2010 Farnborough Air Show agreeing to initiate talks about “future aircraft needs.” IAG is a major customer for both Airbus and Boeing so that any switch to the Chinese company would be viewed as a breakthrough order.

Ryanair Holdings Plc, Europe’s biggest discount airline, said at the Paris Air Show in June that it’s also talking with Comac and has a requirement for at least 200 single-aisle jets.

State-backed Comac expects to announce “substantial” new contracts for the C919 this year, Chen Jin, general manager for sales and marketing, said Sept. 23 at the Beijing Air Show. Test flights for the model are slated for 2014.

Walsh said that while the Chinese plane’s fuel efficiency should be enhanced by its use of Leap-X engines from General Electric Co.’s CFM International venture, IAG needs an aircraft that “works well from day one” and represents value for money.

“Price is very important,” the executive said at the SAE 2011 AeroTech conference. “These are expensive assets in an industry that struggles to get its hands on capital. We’re looking for everything, and we want it cheaper than it is now.”

Walsh made a private visit to Chinese cities including Beijing and Shanghai in the week beginning Aug. 22 to meet with “industry contacts,” IAG spokeswoman Laura Goodes said.

--Editors: Chris Jasper, Chad Thomas.


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