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Japan Airlines has agreed to buy 31 A350s from Airbus
in a deal worth as much as $9.5 billion.
Airbus just inked its first deal with Japan
Airlines on Monday, pledging to deliver 31
new A350 aircraft.
The landmark agreement -- worth as much as $9.5
billion based on list prices -- poses a threat to rival
aircraft maker Boeing ( , Fortune 500 ), which
has been the dominant player in the Japanese aviation
market.
The new Airbus A350 models, which will go into
commercial service next year, are competing directly
with the Boeing Dreamliner for orders.
But the Dreamliner has faced a number of setbacks ,
including a problem with its batteries that grounded
the entire fleet earlier this year.
"Airbus is inching into Japan with a competitive offer
and it's coming at a time when Boeing is really
suffering with its equivalent airliner, the Dreamliner,"
said Goodbody senior aviation analyst Dónal O'Neill.
"It's time for people to consider the A350 because it's
a very well regarded aircraft."
Related: Airbus sees global fleet doubling by 2032
This is the first order for A350s from a Japanese airline.
O'Neill says it could be the first of many.
"This could be a good stepping stone for Airbus to
secure some other sizeable deals in Japan," said O'Neill,
explaining that Japan's ANA ( ) might also
now consider placing an order for A350s.
In a joint press release, Airbus and Japan Airlines said
they expect the A350s will start flying for the airline
starting in 2019.
Fabrice Bregier, president and CEO of Airbus, said, "It
fills us with pride to see a leading Japanese airline start a
new chapter with us."
Some analysts said Japan Airlines may have been
tempted into buying Airbus rather than Boeing planes
because of heavy discounting.
Sterne Agee analyst Peter Arment said the A350s were
probably sold at a discount of more than 50% off list
price so Airbus could gain a foothold in Japan.
Related: How much does it cost to rent a private
jet?
Last month, Airbus, which is owned by the European
aerospace group EADS ( ), predicted the
number of aircraft worldwide would double over the
next 20 years, spurred by rising demand from emerging
markets.
Airbus said a swelling middle class and more affordable
air travel were among the factors fueling the rise in air
traffic, with most of the growth coming out of Asia.
Japan Airlines has agreed to buy 31 A350s from Airbus
in a deal worth as much as $9.5 billion.
Airbus just inked its first deal with Japan
Airlines on Monday, pledging to deliver 31
new A350 aircraft.
The landmark agreement -- worth as much as $9.5
billion based on list prices -- poses a threat to rival
aircraft maker Boeing ( , Fortune 500 ), which
has been the dominant player in the Japanese aviation
market.
The new Airbus A350 models, which will go into
commercial service next year, are competing directly
with the Boeing Dreamliner for orders.
But the Dreamliner has faced a number of setbacks ,
including a problem with its batteries that grounded
the entire fleet earlier this year.
"Airbus is inching into Japan with a competitive offer
and it's coming at a time when Boeing is really
suffering with its equivalent airliner, the Dreamliner,"
said Goodbody senior aviation analyst Dónal O'Neill.
"It's time for people to consider the A350 because it's
a very well regarded aircraft."
Related: Airbus sees global fleet doubling by 2032
This is the first order for A350s from a Japanese airline.
O'Neill says it could be the first of many.
"This could be a good stepping stone for Airbus to
secure some other sizeable deals in Japan," said O'Neill,
explaining that Japan's ANA ( ) might also
now consider placing an order for A350s.
In a joint press release, Airbus and Japan Airlines said
they expect the A350s will start flying for the airline
starting in 2019.
Fabrice Bregier, president and CEO of Airbus, said, "It
fills us with pride to see a leading Japanese airline start a
new chapter with us."
Some analysts said Japan Airlines may have been
tempted into buying Airbus rather than Boeing planes
because of heavy discounting.
Sterne Agee analyst Peter Arment said the A350s were
probably sold at a discount of more than 50% off list
price so Airbus could gain a foothold in Japan.
Related: How much does it cost to rent a private
jet?
Last month, Airbus, which is owned by the European
aerospace group EADS ( ), predicted the
number of aircraft worldwide would double over the
next 20 years, spurred by rising demand from emerging
markets.
Airbus said a swelling middle class and more affordable
air travel were among the factors fueling the rise in air
traffic, with most of the growth coming out of Asia.
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