Airbus’ final flourish trumps Boeing with $75 billion show haul

Airbus Group delivered a final flurry of jetliner orders to see off the challenge from Boeing Co. at the Farnborough Air Show in England, with a tally of purchases and commitments worth $75 billion at list prices.

Airbus’s biggest-ever sales haul at the expo southwest of London eclipsed Boeing’s $40 billion, with the combined figure of $115 billion more than twice that of the last Farnborough event two years ago, though still $14 billion below the total at the 2013 Paris show, which alternates with the British fair.

The European planemaker sealed its show supremacy with a narrow-body order from Asian plane lessor Hong Kong Aviation that firmed up a commitment announced last year, together with a wide-body pledge from Russian Transaero Airlines. Both deals involved revamped models, confirming the importance of a trend to fit new engines on older planes in order to stay competitive in key markets while minimizing production costs.

“Airbus is hunkering down and doing simple things that generate good short-term returns,” London-based Jefferies International analyst Sandy Morris said. “There are markets emerging that we didn’t foresee a decade ago. If you happen to have the right aircraft and engine, it’s the right way forward.”

After dominating Boeing on the first two days of the Farnborough event, Airbus took a breather Wednesday, reporting one deal worth $1.2 billion at list prices. It bounced back Thursday with more than $12 billion of sales and commitments.

All told, Airbus racked up orders or commitments for 496 planes, split between 363 single-aisle models and 133 wide- bodies. That compared with 201 orders at Chicago-based Boeing – comprising 117 narrow-bodies and 84 long-haul planes.

Lessors dominated the early skirmishing and remain “very robust customers,” according to Fabrice Bregier, who heads Airbus’s airliner unit, with Steven Udvar-Hazy’s Air Lease Corp. and AerCap Holdings both placing first-day orders.

Carriers including Qatar Airways, Hainan Airlines, AirAsia Group and British Airways later came to the fore.

“I think this has been a surprisingly good show that speaks to the resilience of the market today,” Boeing Marketing Vice President Randy Tinseth said in an interview after the two company’s had announced their final sales. “As we look to the future, we see more demand and supply in the market.”

While the biggest deal of the show by value went to Boeing, the $19 billion accord for 50 777-9X planes from Qatar Air amounted to the signing off of an order first announced at November’s Dubai Air Show. Qatar also took out options to add 50 more of the planes, though the purchase rights don’t count toward standard order totals.

Airbus’ biggest successes, and the highest-profile development at the Farnborough show, came with its launch of the re-engined A330neo. Air Lease led the way with a commitment for 25 planes, followed by Dublin-based lessor Avolon Holdings with 15 and a $13.8 billion splurge from AirAsia on 50 aircraft, before Transaero rounded out the show with 12 orders.

Other high-profile planes were conspicuous for a lack of order announcements, with Airbus struggling to win contracts for its new A350, which flew at the show and will make its commercial debut at Qatar Airways by the end of the year.

Airbus won just one A350 order for as many of four of the baseline -900 variant from Air Mauritius Ltd. The manufacturer also whittled down the A350 family lineup after committing to the A330neo, culling the -800 version amid poor demand.

The biggest airliner, the A380 double-decker, also drew a blank, as did Boeing’s 747-8 update of the venerable jumbo. Neither aircraft is selling well as customers prefer the largest twin-engine models that have a marginally lower passenger capacity but are far more efficient to operate.

Boeing will draw comfort from retaining its lead over Airbus in net orders accrued this year, with the total rising to 783, compared with 648 at its Toulouse, France-based rival, which entered the expo more than 300 sales behind.

Some of Airbus’s order gains also reflected the fact that the company is still introducing planes to complete its product lineup after Boeing’s sales successes with models such as the 787 Dreamliner, said Barclays Capital analyst Carter Copeland.

“We found the Boeing and Airbus stories as far from one another as we can recall in years,” he said in a note. “Boeing focused almost solely on costs, margins, and efficiency, while Airbus was still in somewhat of a transition mode.”