Bloomberg News

Airbus Sees A330 Production Staying at 10 Monthly Through 2015

July 19, 2013

Airbus SAS (EAD) plans to keep building A330 twin-aisle airliners at a rate of 10 a month at least through 2015 as customers including Singapore Airlines Ltd. (SIA) expand the model’s role in their fleets.

Airbus, which handed over the 1,000th A330 to Cathay Pacific Airways Ltd. (293) today, has a half dozen “major” sales campaigns under way that can be expected to bring in new orders to sustain output at record levels for years, Chief Operating Officer John Leahy said.

“We’ll be in production until the next decade” amid interest from “quite a few customers” among leasing companies and airlines, Leahy told reporters after the delivery ceremony today in Toulouse, France.

Demand for the twin-engine, 300-seat plane, which entered service in 1994, has benefited partly from delays in deliveries of Boeing Co. (BA:US)’s 787 Dreamliner. Hong Kong-based Cathay started flying its first A330 in 1995 and has come back nine times with repeat orders. Toulouse-based Airbus’s backlog for A330s stands at 246 planes, enough for two years of production.

Customers introducing the A330 to their fleets for the first time this year include Iberia (IAG), Sichuan Airlines Co. and Cebu Air Inc. (CEB), which has configured the planes with 436 seats, the densest ever. The A330-300 variant generally seats 300 passengers and the A330-200 seats 246 in two classes.

Sales Thresholds

The A330 is Airbus’s first wide-body plane to break the 1,000-delivery mark, while Boeing has already reached the threshold with its 767, 777 and 747 models. It’s the only wide-body to reach a construction rate of 10 planes a month, a figure reached in April. Airbus has considered accelerating production further, though has held back because of difficulties in getting China to approve the building of planes already sold.

Orders for 27 planes from China for A330s are still in limbo after the government there froze the contracts as part of a campaign against a European Union proposal to tax carbon emissions. Of 45 originally frozen, 18 have been unblocked.

“We’re waiting patiently for the remainder” of contracts to be released, Leahy said.

Tanker Version

The A330 is positioned as a potential replacement for aging Boeing 777-200s, now out of production, and 767s, in competition with the 787-8 and 787-9 variants of the Dreamliner that offer longer ranges than the Airbus model. In addition to being marketed as a passenger plane, the A330 is sold as a freighter and also as a platform for mid-air refueling of combat jets. About 28 airborne-tanker versions have been ordered, with 16 delivered.

Since the 787 first came on offer in early 2004, Airbus has won orders for more than 800 A330s, Leahy said. The average route flown by the A330-300 is 1,800 nautical miles, or about two hours. The aircraft is used for flights as short as 30 minutes and as long as 14 hours.

Airbus plans to formally begin offering a regional variant of the A330 later this year, a move that would lower acquisition and maintenance costs by reducing engine thrust, cutting takeoff weight.

“With lower thrusts, you don’t have to pay as much in route charges, not as much for the engine, obviously, and you have lower engine and airframe maintenance costs,” Leahy said. “That would be good in Southeast Asia for regional flying, and in markets like China.”

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

To contact the editor responsible for this story: Benedikt Kammel at bkammel@bloomberg.net


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