Airbus has announced the cancellation of a multi-billion dollar order from Qatar Airways. The airline and the aircraft manufacturer are in conflict over accelerated surface wear on the A350 fuselage.
Spectacular decision in the aeronautics industry: Airbus canceled a multi-billion dollar order from Qatar Airways, an escalation between the European aircraft manufacturer and one of its biggest customers who blames it for defects on its A350s.
In this war of nerves between the aircraft manufacturer and the Qatari company, which has grounded part of its fleet of A350 wide-body aircraft due to damage to the surface of the fuselages and is suing Airbus for compensation , the latter replied by hitting hard. “We confirm that we have terminated the contract for 50 A321s with Qatar Airways, in accordance with our law,” an Airbus spokesperson told AFP, confirming information from Bloomberg.
Generally, order cancellations are made by customer companies when they no longer have the means to finance the purchase or no longer need the aircraft. At the list price, last published by Airbus in 2018 and almost never applied due to discounts, the value of this order amounted to more than 6 billion dollars.
This acrimony between the aircraft manufacturer and the company dates back to last summer. In early August, Qatar Airways announced that it had received an order from its country’s regulator to ground 13 of its Airbus A350s due to the rapid deterioration of the fuselage surfaces. Currently, 21 of these long-haul aircraft are immobilized, according to the company, whose fleet has 53 A350s. She still has to receive 23 copies and has refused several deliveries since last summer.
For Airbus, which recognizes a degradation of the paint that could expose an integrated metal net – intended to protect the aircraft in the event of a lightning strike on its fuselage made of composite materials -, this situation has no consequences on safety in flight. The European Aviation Safety Agency, EASA, confirmed that these degradations did not entail any airworthiness risks.
default clause
If this defect has been observed on certain aircraft from other companies, Qatar Airways is the only one to ban them from flying, causing a significant loss of earnings for this specialist in long-haul flights.
Denouncing a “threat to international air security protocols”, the European aircraft manufacturer said it was ready in December to resort to independent arbitration. According to Airbus, which intends to “defend its position and its reputation”, it was a question of “resolving the dispute, which the two parties were unable to do during direct and open discussions”, he affirmed in a press release in the tone unusually firm targeting one of its big customers, the second company in the Middle East after Emirates.
Qatar Airways preferred to take the case to the British courts. During a hearing Thursday before the High Court of Justice in London, each party presented its elements. Qatar Airways has claimed compensation of 618 million dollars, along with a penalty of 4 million per additional day of immobilization of its A350s, according to a source familiar with the matter.
Airbus, for its part, invoked a default clause regarding the refusal to take delivery of additional A350s to justify the cancellation of the A321neo order. This single-aisle, whose passenger carrying capacity and range of action has no equivalent with the American competitor Boeing, is at the heart of Airbus’ strategy and its commercial success: the A321neo represented alone in 2021 three quarters of the orders placed with the European aircraft manufacturer. And with nearly 3,400 A321s to be delivered, Airbus has several years of production ahead of it.
A new hearing is scheduled for the week of April 26.