Airlines cancel Boeing and Airbus orders

Increasing numbers of airlines are cancelling orders for aircraft from Airbus and Boeing blaming plummeting demand for air cargo around the world. Many of those that aren’t immediately cancelling are suggesting that they are not worried about any delay to their planes’ delivery.

At the moment the two companies’ full order books mean that any cancellations simply cut waiting lists. However, the two rivals are keeping a nervous eye on cancelled orders in case a tipping point starts to produce ‘white tails’ – planes built but with no home to go to and therefore no livery painted onto their tails.

Air France-KLM has decided not to buy 15 Boeing 777 wide-body jets as it had earlier considered. Doing so will save the French company US$1.78 billion.

Cathay Pacific, Iberia and Kingfisher Airlines have all also delayed delivery or cancelled orders for Airbus’ A380s and Boeing’s 777s.

Should the proposed merger of British Airways and Qantas go ahead the combined corporate entity is likely to need far fewer of Airbus’ 525-seater A380 then they would separately – British Airways has ordered 12 and Qantas 19 of the superjets.

Hardest hit so far are the Asian Pacific airlines which have seen a 10.6 per cent drop in demand. Over 60 per cent of 747-8Fs on order come from the region so delays due to Boeing’s industrial strike that ended on 2nd November, design changes and limited engineering resources may give the carriers some needed breathing space.

Meanwhile, Cathay Pacific is going further than delaying the delivery of its $9.5 billion of aircraft by also delaying construction of its new Hong Kong cargo terminal, offering cabin crew unpaid leave for up to a year, parking two freighters and retiring five others.

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