USA Today
June 16, 2005

LE BOURGET, France (Reuters) — European planemaker Airbus boosted commitments for its planned A350 jet on Wednesday as it scrambles to catch up with Boeing's (BA) mid-sized 787 and found a new Indian buyer for A380 superjumbos.

Boeing is set to regain the lead in commercial jet orders this year for the first time since 2000, but sales at the world's largest air show are helping Airbus gain ground as it bags around $19 billion of deals to Boeing's $12.5 billion. (Related photos: Paris Air Show)

Aircraft leasing giant GE Commercial Aviation Services (GECAS) snapped up 10 of the A350 planes worth about $1.6 billion at list prices, while Indian beer and branding tycoon Vijay Mallya's Kingfisher Airlines bought another five.

The Indian low-cost carrier also agreed to buy five A380s, worth about $1.3 billion at list prices, as well as five A330s in a combined 15-plane deal worth about $3 billion. Airbus now has firm orders for 149 double-decker A380s.

The A350 orders bring to 87 the number of commitments for the plane announced at the show, lifting the A350 project out of the doldrums after a false start that led to a redesign.

Including these orders, Airbus now has 117 commitments for the A350, though that includes 60 from Qatar Airways on which the Gulf airline says some details still need to be finalized.

Airbus has modernised the initial design of the A350 with newer wings and more high-tech composite materials to try to prevent Boeing running away with the market for efficient mid-sized aircraft that fly long distances on flexible routes.

Boeing has pre-sold 266 of the 787 Dreamliners, which are due to enter service from 2008 compared with 2010 for the A350. It has not so far announced 787 orders at Le Bourget, however.

Airbus had previously placed its bets for 21st century travel on a different hub-to-hub model, designing its A380 to cope with fast-growing air traffic coupled with limited airport capacity and environmental restrictions on slots.

The 555-seat A380 has wrested dominance of the market for large planes over 400 seats away from Boeing, though Boeing may hit back with a stretch version of its venerable 747 jumbo jet.

But Airbus officials have acknowledged in Paris they lost business by leaving the mid-sized market to Boeing, and that an earlier version of the A350 — a revamp of its A330 twin-engine model — had been too timid a response to the 787 threat.

Indian demand has been a highlight of the air show amid forecasts of strong air traffic growth in the populous nation.

Kingfisher Airlines, an Indian budget carrier backed by the country's largest beer company, is the brainchild of flamboyant tycoon Vijay Mallya, whose UB Group makes Kingfisher beer, India's largest selling brand, and other lifestyle items.

Mallya has often been compared to British entrepreneur Richard Branson, whose empire spans planes and trains to bridal gowns. He is banking on the emergence of millions of new Indian consumers to fill planes and boost his many lifestyle brands.

"There is a whole generation of Indians who are earning more and have a better lifestyle and propensity to spend," he said.

Mallya's appearance in diamond-studded earring livened up the carefully choreographed announcements of jet orders.

These are part of a battle of wits at Le Bourget, where claims of supremacy by Airbus and Boeing bounce back and forth across a temporary shopping boulevard for aerospace and arms.

Airbus is clearly delighted about a rebound in the fortunes of the A350 and has outsold Boeing by almost 50% on the basis of commitments announced at the show so far. It hopes this will divert attention from a threatened trade war with Boeing.

Boeing however came to Paris having already notched up successes for the 787 and continues to announce steady sales for its 777 transatlantic workhorse. And both companies agree Boeing will grab back first place in global orders from Airbus in 2005.

Boeing on Wednesday added firm orders for 18 737-800s, worth about $1.2 billion at list prices, from Spanish carrier Air Europa to its show order book. The airline also took out options for 12 more of the single-aisle jets.

Boeing also said for the first time on Wednesday that it was considering interim chief executive James Bell as a candidate to take on the job permanently, but said he was still unlikely to get the job as it looked for an executive with experience of running a large company over a "sustained period of time."