Translated material
Start from scratch
Airbus makes a $10 billion decision
Airbus chief executive Christian Streif announced yesterday at the Farnborough International Airshow that his company has decided to restart design of the A350 aircraft. This will delay the project by two years and increase its cost to $10 billion - double the original estimate. Mr. Streif said Airbus had asked the governments of France, Germany, Spain and England - all countries whose companies are shareholders in the aircraft manufacturer - to subsidize the project. European governments face difficult decisions. The practice of providing Airbus with financial assistance from the budget is harshly criticized by the United States, which even opened a case against the European Union within the World Trade Organization, stating that such subsidies violate the principle of fair competition.Difficulties with the A350, as well as with another promising Airbus project, the giant A380 airliner, cost the career of Gustav Humbert, Mr. Streif's predecessor as the group's chief executive. The last important public statement that Mr. Humbert managed to make before his dismissal concerned the A350. In May of this year, he said that the concern was deciding whether to continue designing this aircraft on the same course or sacrifice the work done and start from scratch. Initially, European aircraft manufacturers intended to obtain the A350 in a relatively simple way: by modernizing the existing A330 aircraft. With the technical characteristics that were assumed for the A350 in this case, the European airliner was frankly inferior to the competing Boeing-787 development, which is now being created in the USA. Mr Humbert promised to announce his choice during the Farnborough Air Show.
Christian Streiff, who was appointed head of Airbus just two weeks ago, had to fulfill this promise. Yesterday he said the plane would now have a wider, redesigned fuselage. To commemorate this fact, the model has been renamed A350XWB (extra wide body). To ensure that it meets all possible specific requirements of different airlines, three modifications will be designed (previously two were planned). Mr. Streif promised to transfer the project onto new tracks in three months. He admitted that in the new conditions, the design of the A350 will take two years longer than expected. Previously, the start of commercial deliveries was planned for 2010, but now it has been moved to 2012. Mr. Streif, however, said that he would do everything possible to reduce this period.
There is no complete clarity regarding the sources of financing for project work. Mr Streif said they were now valued at $10 billion and that Airbus had asked the governments of France, Germany, Spain and Britain "for help and support".
The head of the concern also spoke about problems with the A380. Last year, Airbus announced that the start of deliveries of the largest aircraft ever built would be delayed by six months from its previously approved schedule. A month ago, the announcement of new problems in the design of the giant aircraft led to a sharp drop in share prices of Airbus and its controlling shareholder, the European defense and space agency EADS, by more than a quarter. Yesterday, Mr. Streif said that in order to overcome the problems that had arisen, Airbus had decided to re-form the entire network of suppliers of components for the A380.
Due to the unsuccessful progress of the A350 and A380 projects, Airbus has already lost a significant share of the global civil aircraft market to its eternal American competitor, Boeing. This is especially galling for Europeans because for the previous five years they have outpaced Boeing in the number of aircraft sold. But in the six months of this year, Boeing received orders for 487 aircraft, while Airbus received orders for only 117.