x Abu Dhabi, UAETuesday 23 January 2018

Middle East travel boom gives Airbus sales a lift

The French aircraft maker has upped its sales estimates from the start of the year

Airbus has called the Middle East a driver behind an increase in its sales forecast for this year to more than 300 jets after a rise in air travel demand. Growing economies in Asia and the Middle East should help to boost the European aircraft company's order book beyond earlier expectations, said Tom Enders, the president and chief executive of Airbus.

"Before, we estimated selling 250 to 300 aircraft for the year in January," Mr Enders said. "Now we will definitely make 300-plus [sales]." The Middle East, he said, "as we saw it last year will, we believe, continue to be an important growth machine". Airbus believes it can sell 20 A380 superjumbos this year, up from an earlier estimate of 10. But Mr Enders declined to say whether Emirates Airline, the largest customer of the $300 million (Dh1.1 billion) aeroplane, or its Gulf-based peers Etihad Airways or Qatar Airways were likely to be behind the increase in orders.

"Much of the [A380] backlog is in the Middle East region," he said. "We are convinced we will see more A380 [sales] coming out of the Middle East but whether it is this year, next year or the coming years, it remains to be seen." Despite their relatively modest local populations, Middle East nations are major customers for new long-range aircraft as they seek to develop their travel and tourism industries and direct global air travel flows through their airports.

And scores of short-range planes, such as the Airbus A320 and Boeing 737, have been ordered by the likes of flydubai and Air Arabia as budget travel has grown across the region. This year, Qatar Airways said it was interested in a multibillion-dollar order for up to 30 new single-aisle planes from either Bombardier or Airbus. Emirates, meanwhile, has said it may choose to buy about 12 new wide-bodied aircraft to cope with growing demand and to replace aircraft due to be retired in the next few years.

Airbus was unable to answers questions this week from Emirates about its new long-range jet, the A350, of which the airline has 70 on order. In March, Tim Clark, the president of Emirates, called on Airbus to be more forthcoming. "It would be a major problem for us if they did not deliver on time, and if [the aircraft] are overweight, then there are issues with that as well," Mr Clark said. The French plane maker was "not really" able to provide the requested information, Francois Caudron, its vice president of business programme development, said yesterday.

"We have sold the aircraft with a level of guarantees and we are managing our programme in a way to deliver on those guarantees," Mr Caudron said. The stakes are high for Airbus - Emirates is the largest customer for the A350, and is scheduled to receive its first A350s in March 2014, with another 50 on option. Each A350XWB costs between $225m and $285m. "Keeping Emirates happy on the A350 is a must," said Saj Ahmad, the chief analyst at the UK-based FBE Aerospace. In addition to the A350 orders, "it also has the bulk of the A380 orders, too. Emirates can move to hurt either programme by cancelling or deferring orders", Mr Ahmad said.

Airbus was also watching the Middle East as a potential venue for its next engineering centre outside France, officials said. After setting up facilities and hiring local engineering recruits in places such as Bangalore, Beijing, Moscow, and Mobile and Wichita in the US, the next facility could be built in a city such as Abu Dhabi, Dubai or Doha, said Charles Champion, the executive vice president of engineering at Airbus.

"First you need a critical mass of engineers and universities," Mr Champion said. "In the Middle East, I would not be surprised if we opened a centre over there in the coming years. I would say we are in the early stages." igale@thenational.ae