Airbus to boost China output as it nears jet deal during Macron trip


The Airbus deal is expected to be unveiled together with a package of agreements, and could include orders for around 100 jetliners.
The Airbus deal is expected to be unveiled together with a package of agreements, and could include orders for around 100 jetliners.PHOTO: REUTERS

PARIS (REUTERS) - Airbus is set to boost production of narrowbody jets in China as it nears a new multi-billion-dollar deal to supply the world's fastest-growing aviation market during a visit by French President Emmanuel Macron, industry sources said.

The deal is expected to be unveiled together with a package of agreements coinciding with the French leader's visit, and could include orders for around 100 jetliners, they added.

The final number of jets to be sold has not been determined. China is also said to be shopping for larger jets like the A-330.

Airbus declined to comment on Monday (Jan 8).

Airbus and its US rival Boeing compete for large-scale orders in China and such package deals are typically rolled out during major diplomatic events, but not without last-minute negotiations on the quantity and price of jets.

Boeing announced a deal for 300 aircraft during a visit to China by US President Donald Trump in November.

About one in every four planes that Airbus produces is delivered to China, but fewer than 8 per cent are assembled at its Tianjin facility outside Beijing - one of four A-320 assembly plants including two in Europe and one in the United States.

 

Airbus is likely as part of any new airplane order to agree to lift the number of aircraft assembled in Tianjin from the current level of around 50 a year, the sources said.

NO A-380 DEAL

The European plane maker is not, however, expected to announce a breakthrough in Chinese support for the 544-seat A-380 superjumbo, whose future is threatened by poor sales.

The Financial Times reported earlier that Airbus was offering an industrial partnership on the world's largest airliner as part of Mr Macron's visit to China.

Mr Macron is accompanied by industry leaders, including Airbus planemaking president Fabrice Bregier, on his visit.

Industry sources said that Airbus has studied the possibility of selling China a stake in the A-380 superjumbo programme, but no immediate deal is on the table.

The idea, which has been on the back-burner in Toulouse for some time, would resemble Airbus's decision to take a stake in the Bombardier CSeries, but so far there has been little traction and no deal is imminent, one source said.

"It's not tomorrow," another source added, while others stress the A-380's fate hinges instead on ongoing talks to sell 36 of the jets to Dubai's Emirates.

An Airbus spokesman said: "We don't comment on speculation".

Airbus believes that if the A-380's future can be secured into the next decade, then China is likely to come into the picture because of its frenetic demand growth.

Airbus sees untapped demand for 100 Airbus A-380s in China, while Boeing argues that traffic is better served by smaller jets.

The US firm is meanwhile expected to confirm its position as the world's largest planemaker when it announces 2017 deliveries on Tuesday. It has targeted 760-765 deliveries.

Despite a record December that saw Airbus hand over more than 700 jets for the first time last year, the first delivery of its newest model - the A-350-1000 - slipped into 2018 and should happen "early this year", a spokesman said.