Airbus SE has finalized contracts for 120 former C-series aircraft on Thursday, prompting aviation loss program that it took over from Bombardier Inc.
Airbus, which in July absorbed C series and renamed it to A220, announced that it had completed 60 aircraft sales contracts for American JetBlue Airways Corp. co-founder of WestJet Airlines Ltd.
The first 110 to 130-seat aircraft since Airbus took oversight over the Montreal program would not have been owned by the Bombardier, said Richard Aboulafia, an analyst at Teal Group. The Quebec aircraft and train manufacturer did not have the deep pockets needed for the development, construction and sale of the aircraft, he said in an interview.
"It helps make this program even more successful," he said. As long as Airbus did not absorb that program in July, this program was somehow intimidating. Thanks to such contracts, which are mainly the result of the acquisition of Bombardier, you achieve a much higher production rate. And this is definitely good for everyone involved.
Airbus, headquartered in Europe, said aircraft would be made in Mobile, Ala., Where a new assembly plant is being built next to the existing Airbus factory. However, Mr. Aboulafia said that Bombardier is expected to gain part of the orderly deal.
Bombardier spent more than $ 6 billion in aircraft development over the years, but lacked financial support to bring it to the market. Airbus became a builder and aircraft vendor in July, while Bombardier retained 34 percent ownership and Quebec 16 percent.
Spokesperson Bombardier was not available for comments on Thursday.
Airbus did not submit financial sales information. Mr. Aboulafia said aircraft prices were from 81.5 to 91 million dollars, although the discounts were 60 percent standard.
The A220 extension raises the stage for a widespread conflict with Boeing Co., which last month concluded a takeover contract of 80 percent of the commercial unit Embraer SA, with the approval of the Brazilian government.
By 2018, the greatest attention is focused on the essential sales battle between transatlantic aircraft, while Boeing has so far led.
In November, Airbus completed 35 percent of net sales on the main jetliner market compared to its rival in the United States after 11 months in the shadow of management changes and delays in delivery.
Since then, it has accelerated with bids for 220 aircraft, including ordering 100 aircraft from Irish landlord Avolon, leaving 90 times less than 690 aircraft at the end of Boeing.
On a similar basis, excluding the previous C series, Airbus has reached 480 net sales per year compared to the latest Boeing 690 figure, while market share reached 41 percent based on reported orders.
Airbus plans to provide data for the entire year on January 11th. Both companies often make arrangements at the last moment to raise their total annual amounts, and the announcement is postponed until the beginning of next year.
Meanwhile, Airbus is preparing to deliver expected deliveries due to growing doubts as to whether it has achieved its 2018 target for 800 deliveries, or 782 without counting any Canadian airline A220, say industrial sources.
With Reuters files