http://www.bloomberg.com/apps/news?p...=conews&tkr=BA:US&sid=a10Xj_Js1XEA

A strange message to send to your customers, no?

Should we be more sceptical about an Air India order for A380s?

It sounds like the skeptics might not have been too far off. The question is if pride will get in the way of making a good business decision.

Seems like it's not made up, because they are quoting John Leahy in an older article:

http://www.bloomberg.com/apps/news?p...=conews&tkr=BA:US&sid=azWJhsGU8DdM

Quote: Airbus Chief Operating Officer John Leahy said in a Bloomberg Television interview at the Farnborough International Air Show this month that Airbus wants to avoid installing aircraft interiors for specific clients only to find halfway through the work that the airline can't accept the plane. That could require ripping out the interior to install a different one for another customer, and charging the original buyer several million dollars to cover the cost, he said.

You know things are bad when the aircraft manufacturer tells YOU it's maybe a good idea to delay deliveries 

That's not good news and Airbus has a substantial amount of orders from India:

INDIA
Boeing Ordered Delivered Undelivered
737 139 89 50
777 36 19 17
787 37 0 37
212 108 104

Airbus Ordered Delivered Undelivered
A320 290 84 206
A330 42 10 32
A340 10 0 10
A350 5 0 5
A380 5 0 5
352 94 258

Maybe the thread titel should include Boeing, too, as it looks like Boeing has the same view according to the article.

"Boeing Co. and Airbus SAS are talking to Indian airline companies about slowing deliveries of aircraft as the country's air market slumps due to rising oil prices and a weak world economy, the Wall Street Journal said."

Quoting NYC777 (Reply 4): A350 5 0 5

Those have been removed from the totals in July (as per a Flight Global article).

Quoting NYC777 (Reply 4): That's not good news and Airbus has a substantial amount of orders from India:

When you consider both manufacturers have a backlog of a couple of thousand, 258 isn't all that many in the grand scheme of things.

Quoting Revelation (Thread starter): A strange message to send to your customers, no?

While unusual, I don't think its strange - this way Airbus may still secure the order for the future, rather than delivering a whole load of plans at a time when the buyer is inj potential financial difficulties, resulting in the buyer not taking delivery and thus incurring more costs.

Its good fiscal responsability on the part of Airbus imho.

AI could just replace the older Airbus jets with newer better gas drinking ones , lesser mech issue jets --> More time in air --> more cash --> better situation.

I know that the old IA birds are in a real bad state.

Quoting Moo (Reply 6): While unusual, I don't think its strange

I think it is quite strange for either manufacturer to be encouraging airlines to defer deliveries. It doesn't matter who the manufacturer is. It certainly speaks volumes about the condition of the Indian aviation sector, and puts some perspective on the order orgy that's been going on for the past few years.

-Dave

Quoting PlanesNTrains (Reply 8): I think it is quite strange for either manufacturer to be encouraging airlines to defer deliveries. It doesn't matter who the manufacturer is. It certainly speaks volumes about the condition of the Indian aviation sector, and puts some perspective on the order orgy that's been going on for the past few years.

It has everything to do with the Indian aviation sector, which is not in great shape. Similar to the US, the markets are oversaturated, and needs consolidation. Up until recently, there were 50 daily flights between Mumbai and New Delhi! That equates to 4 seats per person, and fare promos offered with prices as low as $2 USD.

From today's Wall Street Journal

Said Naresh Goyal, chairman of Jet Airways, "We are all in trouble."

On Wednesday, Deutsche Lufthansa AG stuck to its financial forecast for the year but warned of tougher conditions. On Monday, Ryanair Holdings PLC posted its first quarterly loss as a public company.

The International Air Transport Association, an industry group, estimates that the global industry could lose as much as $6.1 billion this year if oil prices remain close to recent highs, with almost one-third of that coming from outside North America.

Airbus and Boeing still see India as a cornerstone of an expected Asian aerospace boom. Boeing said last week that it expects India will need 1,001 new aircraft, valued at $105 billion, by 2027.

Boeing says it believes its backlog is in good shape in India, because it didn't market aggressively to start-up airlines that might be more prone to delaying deliveries. Like Boeing, Airbus says it believes India's air market will rebound and that delaying deliveries could help cushion the blow in the meantime.

Aviation executives and analysts figure that India's airlines together will lose $1 billion to $2 billion this year -- twice what they lost in 2007. "Airlines in India face an economic emergency," said Kapil Kaul, a consultant in New Delhi at the Centre for Asia Pacific Aviation.

AI will also be cutting its domestic market by up to 15% and will return 14 leased aircraft. Jetlight (Jet Airways' LCC) is implementing BOB.

Here's the WSJ article:

http://online.wsj.com/article/SB121744399924297723.html?apl=y&r=390656
(Subscription Required)

In the case of Airbus if not Boeing (but i believe both), they could find those slots freed for customers of other potential customers. Customers that may not be as affected as Indian airlines are today. It is also a measure to save millions of dollars in case airlines are uncapable of taking delivery of this aircraft during a time in which their markets shrink. However, there are places in the world where they still could take some aircraft for expansion or replacement. They probabily see India as having a dim future in the air travel sector with very competitive train fares.   

I understand this mesage to be a help to Indian Airlines. They don't have to say the first word, and can just agree to the proposal, which means they don't loose their face by accepting a proposal...

Quoting Revelation (Reply 2): Seems like it's not made up, because they are quoting John Leahy in an older article: http://www.bloomberg.com/apps/news?p...=conews&tkr=BA:US&sid=azWJhsGU8DdM Quote: Airbus Chief Operating Officer John Leahy said in a Bloomberg Television interview at the Farnborough International Air Show this month that Airbus wants to avoid installing aircraft interiors for specific clients only to find halfway through the work that the airline can't accept the plane. That could require ripping out the interior to install a different one for another customer, and charging the original buyer several million dollars to cover the cost, he said.

Leahy could be talking about Kingfisher's A345's, apparently some of them are up for sale. And I believe their A332's are still sitting around at TLS as well, correct? Some of the first 77L's for AI were for months at Boeing field as well, IIRC.

Certainly with the huge backlog of both manufactureres, it makes sense to shuffle a little bit with delivery slots. I'm sure lots of airlines can't wait till 2012 or so to take delivery of their A320/A330 or B737/B777...

Quoting PlanesNTrains (Reply 8): I think it is quite strange for either manufacturer to be encouraging airlines to defer deliveries. It doesn't matter who the manufacturer is.

I sniff a litlle bit of capacity planning going on...

Both manufacturers are ramping up production across their ranges, as we head towards a slowdown. I sense some aspects of trying to get a handle on just how far to let the production rates rise, without incurring too much risk..

Rgds

Quoting UA772IAD (Reply 9): It has everything to do with the Indian aviation sector, which is not in great shape. Similar to the US, the markets are oversaturated, and needs consolidation. Up until recently, there were 50 daily flights between Mumbai and New Delhi! That equates to 4 seats per person, and fare promos offered with prices as low as $2 USD.

Certain markets are very over-served. In international, BOM to LHR and JFK both have depressed yeilds due to over-supply.

Quoting Astuteman (Reply 13): I sniff a litlle bit of capacity planning going on...

They're also trying to shift production slots towards customers who are healthier but want to replace less fuel efficient aircraft quickly.

Lightsaber