Bloomberg News

Airbus Said to Lose 10 More Orders From China on Carbon Curb

March 15, 2012

Airbus SAS has had another 10 aircraft orders from China suspended because of the nation’s opposition to Europe’s curb on aviation emissions, three people with knowledge of the situation said.

China has now suspended a total of 55 plane orders, said the people, who declined to be identified because details of the contracts are private. China is among 27 nations that have said they will consider retaliatory steps following the EU’s cap on carbon dioxide pollution. Agence France-Presse reported the suspension earlier.

China is holding hostage orders for 35 widebody A330s and 10 double-decker A380 jets as it seeks to overturn the European Union’s inclusion of airlines globally into its emissions trading system, Louis Gallois, chief executive officer of Airbus parent European Aeronautic, Defence & Space Co., said last week. Some 25 of the A330s are already in the early stages of construction, Toulouse-based Airbus told reporters last week.

“There is clear evidence for a developing trade conflict that should drive government to take action,” Airbus spokesman Rainer Ohler said today. “Aircraft have long lives and when a campaign goes to the competition, recovery can take many, many years. A suspension today can turn into orders lost and jobs lost for years and years.”

Ohler declined to comment on whether 10 additional planes are also threatened.

China hasn’t forbidden the nation’s airlines from buying Airbus planes, and won’t dictate their purchasing strategy, Li Jiaxiang, director of the Civil Aviation Administration of China, said in a March 10 interview in Beijing. Airlines are encouraged to buy planes based on cost savings and increasing reliability and safety, he said.

An official at Shanghai-based China Eastern (670) said today that the airline hasn’t cancelled or changed order plans. Spokespeople at China Southern (1055), Asia’s biggest carrier by passengers, weren’t immediately available out of hours. They declined to comment on the issue when contacted earlier. Air China (753), the world’s biggest carrier by market value, wasn’t immediately available to comment.

To contact the reporter on this story: Andrea Rothman in Paris at aerothman@bloomberg.net

To contact the editor responsible for this story: Andrew Noel at anoel@bloomberg.net


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