Airbus is closer to building biggest of passenger planes

32 orders received for 550-seat airliner

June 06, 2000|By BLOOMBERG NEWS

SYDNEY, Australia - Airbus Industrie moved a step closer to building the world's largest passenger plane yesterday after it said International Lease Finance Corp. wants five of its A3XX superjumbos, which would be bigger than Boeing Co.'s 747.

International Lease, the world's No. 2 airplane-leasing company, thinks carriers need the A3XX to serve busy Asian hub airports, said John Leahy, Airbus' vice president for commercial sales.

The European planemaker has pledges for 32 of the planes and expects to reach the threshold of 50 needed to commit to production "very readily," he said.

Airbus' supervisory board is expected to decide this week whether to sell the plane, which would seat at least 550 passengers, compared with 416 in standard configurations of Boeing's 747. Air France, Singapore Airlines and Emirates Airlines have said they are interested in being among the first buyers of the super-jumbo.

"Airbus has got no more worries for the A3XX," said Doug McVitie, managing director of Arran Aerospace, a Scotland-based aerospace-consulting company. "If ILFC is committing to $1 billion of a brand-new aircraft without even having customers lined up, that'll make it so much easier for other major airlines to feel comfortable about buying the aircraft."

The A3XX will cost $12 billion to develop and have a price tag of $230 million per plane.

Boeing said it will be ready with a larger version of the 747 that would be cheaper to build, purchase and operate than the A3XX "super-jumbo." The company is likely to begin selling the new 747 model this year, Boeing Chairman Phil Condit said at a press briefing in Paris yesterday.

To begin production, Boeing would need 20 firm orders for the B747-X. The plane would be able to carry about 500 people, some 60 to 90 more than the current 747-400, Condit said. The A3XX has been closely watched by Boeing's investors because it would end the Seattle-based plane maker's 30-year monopoly on jetliners seating more than 400 people. The rivalry could hurt sales of the 747, though some analysts are still unconvinced there is strong demand for the A3XX.

Boeing shares fell 93.75 cents to $38.9375 on the New York Stock Exchange."

A spokeswoman for International Lease declined to comment.

The company, a unit of American International Group Inc., has a fleet of more than 400 Boeing and Airbus aircraft it leases to 120 airlines around the world. It ranks as the world's largest buyer of wide-bodied aircraft.

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