This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.nytimes.com/2013/06/18/business/global/big-jets-may-be-back-in-demand-with-economy.html

The article has changed 4 times. There is an RSS feed of changes available.

Version 0 Version 1
Big Jets May Be Back in Demand With Economy At Paris Show, Some Signs of Renewed Demand for Big Jets
(about 5 hours later)
LE BOURGET, France — After several years of intense demand for smaller, single-aisle workhorses, the European plane maker Airbus on Monday secured its first new customer in five years for its twin-deck A380 superjumbo jet, a deal that it hoped signaled that a nascent recovery in the global economy would revive airlines’ interest in larger passenger jets. LE BOURGET, France — After several years of intense demand for smaller, single-aisle workhorses, the European plane maker Airbus on Monday secured a customer for its twin-deck A380 superjumbo jet, in a deal the company hoped would signal a revival in interest in larger passenger jets.
The agreement, with a little-known German leasing company, Doric Asset Management, was for 20 of the planes, which typically seat around 525 passengers, and was valued at $8.1 billion at list prices. The agreement with a little-known German leasing company, Doric Asset Finance, was for 20 planes, and was valued at $8.1 billion at list prices. Doric was Airbus’s first customer for its superjumbo plane, which typically seats around 525 passengers.
The order came on the opening day of the Paris Air Show amid a flurry of other announcements for wide-body planes made by Airbus’s American rival, Boeing, including a planned stretch model of its flagship 787 Dreamliner and a long-range version of its popular 777 jet. The order came on the opening day of the Paris Air Show amid a flurry of announcements of orders for wide-body planes made by Airbus’s American rival, Boeing, including a planned stretch model of its flagship 787 Dreamliner and a long-range version of its popular 777 jet.
Airbus has struggled to garner new orders for the A380, which entered commercial service in 2007, three years late, after a series of development snags. Airbus, which has sold 282 of the planes, has said it hoped to deliver 750 over the expected 25-year life of the superjumbo program. Currently, nine airlines operate a total of just over 100 of the planes. Airbus has struggled to garner new orders for the A380, which entered commercial service in 2007, after a series of development snags. Airbus, which has sold 282 of the planes, has said it hopes to deliver 750 over the 25-year superjumbo program. Currently, nine airlines operate just over 100 of the planes.
The A380 has been a particularly tough sell to leasing companies because airlines have tended to seek extensive and costly customization of its cavernous interior in order to differentiate themselves from competitors. Such work can be an onerous proposition for lessors, which often roll a plane over to different airlines over the course of its life. Two years ago, International Lease Finance Corporation, one of the world’s largest aircraft lessors, dropped plans to buy 10 superjumbos after it failed to find customers as the global slowdown drove airlines to rein in seat capacity. The A380 has been a particularly tough sell to leasing companies because airlines have tended to seek extensive and costly customization of its interior to differentiate themselves from competitors. Such work can be an onerous proposition for lessors, which often roll a plane over to different airlines during its lifetime. Two years ago, International Lease Finance Corporation, one of the world’s largest aircraft lessors, dropped plans to buy 10 superjumbos as the global economic slowdown drove airlines to rein in seat capacity.
But Doric, which is based in Offenbach, near Frankfurt, said Monday that it was in talks with several potential leasing customers for the A380 jets, which it would start to receive in 2016. But Doric, which is based in Offenbach, near Frankfurt, said on Monday that it was talking with several potential customers for the A380 jets.
“We see how airlines that do not yet have the A380 are interested in it and approach us and ask questions, which shows us that there is pent up demand for this aircraft,” said Mark Lapidus, Doric’s chief executive. He said he expected his company would easily place the planes with two or three airlines. “We see how airlines that do not yet have the A380 are interested in it and approach us and ask questions, which shows us that there is pent-up demand for this aircraft,” said Mark Lapidus, Doric’s chief executive. He said he expected his company would easily place the planes with two or three airlines.
"If anything, we are perhaps under-ordering'' the A380, he said. “If anything, we are perhaps under-ordering” the A380, he said.
Doric’s order came amid news that another leasing company, GE Capital Aviation, planned to order up to 10 models of a stretch version of Boeing’s 787, which the American manufacturer was expected to formally commit to building this week. The larger 787 is expected to seat 320 passengers, compared with 210 to 290 for the Dreamliner models currently in production. Another leasing company, GE Capital Aviation Services, planned to order up to 10 models of a stretch version of Boeing’s 787, which the American manufacturer was expected to commit to building this week. The larger 787 is expected to seat 320 passengers, compared with the 210 to 290 seats in the Dreamliners currently in production.
Qatar Airways also disclosed an agreement to buy nine of Boeing’s long-range 777-300ER wide-bodies valued at $2.8 billion. Two of those planes, which typically seat 390 passengers, had previously been attributed on Boeing’s order book as going to an unidentified customer. Analysts said they were skeptical about a fundamental change in the market for planes with more than 400 seats, like the A380 and Boeing 747.
Analysts said they were skeptical that anything fundamental had changed in the market for planes with more than 400 seats, like the A380 and Boeing 747. “Long term, the financial future for the A380 looks pretty weak,” said Saj Ahmad, chief analyst for StrategicAero Research in London. “It’s a very small niche market.”
‘'Long term, the financial future for the A380 looks pretty weak,'’ said Saj Ahmad, chief analyst for Strategic Aero Research in London. ‘'It’s a very small niche market.'’
Boeing, whose largest plane, the 747-8, maxes out at 500 seats, has estimated total worldwide demand for 760 airplanes of that size over the next 20 years. Airbus has said it believes the market for such jets to be much larger — around 1,700 over the next two decades.
Despite the dearth of recent A380 orders, “the basics haven’t changed,” said Christopher Emerson, Airbus’s senior vice president for marketing. He attributed the slower-than-expected uptake of A380s to bad timing, noting that the first deliveries came less than a year after the collapse of Lehman Brothers, which set off the global financial crisis and subsequent recession.Despite the dearth of recent A380 orders, “the basics haven’t changed,” said Christopher Emerson, Airbus’s senior vice president for marketing. He attributed the slower-than-expected uptake of A380s to bad timing, noting that the first deliveries came less than a year after the collapse of Lehman Brothers, which set off the global financial crisis and subsequent recession.
“Now that we are coming out of the downturn, you will start to see traffic growing faster,” Mr. Emerson said. “Now is the time for the A380 to do what it was designed to do: capture growth.”“Now that we are coming out of the downturn, you will start to see traffic growing faster,” Mr. Emerson said. “Now is the time for the A380 to do what it was designed to do: capture growth.”
John Leahy, Airbus’s head of sales, has set a goal of 25 orders for the A380 this year. The Dubai-based carrier, Emirates, which is already the superjumbo’s largest customer with 90 planes on order and 34 in operation, has hinted it may buy an additional 30. Other airlines, including Garuda Indonesia and Turkish Airlines, have expressed recent interest in the A380 as well.