First Time for Airbus: Japan Airlines Places $9.5B Order
Japan Airlines Co. Ltd. (JAL) has signed an agreement to buy 31 wide-body Airbus A350 XWB aircrafts with an option to purchase 25 more, JAL president Yoshiharu Ueki announced Monday in Tokyo.
The purchase is a big step for Airbus, as Boeing Co. has supplied over 80 percent of the airplanes ordered by Japanese airlines in the last decade according to Boeing.
“I must say that achieving this breakthrough order and entering a traditional competitor market was one of my personal goals,” Fabrice Bregier, president and CEO of Airbus, said at a news conference call.
“Japan Airlines is well known as one of the most preferred airlines in the world providing its passengers with an excellent flight experience. We sincerely welcome Japan Airlines as a new Airbus customer and feel honored by this first ever order from Japan for our all-new A350 XWB,” Bregier stated.
This is Airbus’ first ever order from JAL, and Airbus’ biggest order from Japan to date. Airbus and JAL plan to have the A350 XWB planes in service starting 2019, with the A350 XWBs replacing some of JAL’s aging fleet over six years.
“We will utilize the A350 XWB to a maximum. [It] offers a high level of operational efficiency and product competitiveness, while positively catering to new business opportunities after slots at airports in Tokyo are increased,” stated Yoshiharu Ueki, president of Japan Airlines.
With this purchase, JAL aims to improve service, profitability, and expand their route network according to Ueki.
Boeing Left Out
Airbus’s discussions with Japan’s two largest airlines, JAL and All Nippon Airways Holdings Inc. (ANA), started in May, Bloomberg Businessweek reported.
Both JAL and ANA operate mostly Boeing planes. ANA has a fleet of 236 planes, 197 of which are Boeing, and 17 single-aisle Airbus A320s. JAL has a fleet of 214 aircraft, 166 of which are Boeing planes.
The companies were the first operators of the Boeing 787 Dreamliner, but delays and its grounding due to overheated batteries could have played a part in this decision. Analysts are saying Boeing could even lose its footing in Japan.
ANA has the largest fleet of 787 Dreamliners in the world, and delays have cost the airline millions. Meanwhile, the JAL order will allow Airbus to fly into the Japanese plane market.
“With this order, it gives us more momentum to look for potential joint R&D efforts for the future generation of aircraft,” Bregier said at the news conference.
Last month, ANA was reported to be close to a decision purchasing either Boeing’s 777X or Airbus A350 aircraft.
“It’s getting close to the time we need to make a decision,” ANA president Shinichiro Ito told Bloomberg Businessweek in Sept. “The key will be what plane matches our needs best.”
Boeing plans to continue supplying JAL in the longer term.
“The Boeing Company respects Japan Airlines’ decision. Although we are disappointed with the selection, we will continue to provide the most efficient and innovative products and services that meet longer-term fleet requirements for Japan Airlines,” Boeing stated in an email.
“We have built a strong relationship with Japan Airlines over the last 50 years and we look to continue our partnership going forward.”