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ElroyJetson
Posts: 1246
Joined: Fri May 26, 2017 5:04 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 4:59 pm

Opus99 wrote:
https://airinsight.com/iata-boss-worried-about-qatar-airbus-feud/

Interesting comments from WW here.

Talks about airbus exploiting their current market strength.

Talks about a long list of airlines that wanted to cancel contracts with airbus but Airbus did not allow them

Wants to see a strong Boeing and strong airbus

Etc etc


First of all, thanks for the link. As with so many statements from Corporate leaders you need to read as much between the lines as what is said.

Willie Walsh seems to be indicating Airbus has been playing hard ball with its customers during the pandemic. My impression is Airbus is not engendering warm fuzzy feelings among much of its customer base. This can often bite you in the ass down the road. We shall see.

I agree with Revelation. I think this is a fight between QR and Airbus that other airlines are watching very, very, closely. For QR to sue Airbus is a drastic step. For Airbus to cancel a valid contract for 50 aircraft is also a drastic step imho.

I make no predictions as to the Court case. To me there are too many unknown variables. However, I do predict the ramifications of this dispute once settled will be far reaching for for many years to come for both Airbus and the entire aviation industry. We are entering unprecedented territory.
 
Gar1G
Posts: 53
Joined: Mon Oct 25, 2021 3:31 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 5:10 pm

ElroyJetson wrote:


Willie Walsh seems to be indicating Airbus has been playing hard ball with its customers during the pandemic. My impression is Airbus is not engendering warm fuzzy feelings among much of its customer base. This can often bite you in the ass down the road. We shall see.



It has been widely reported by both WSJ and Bloomberg that the hardball approach is true AND that some within Airbus leadership feared what would happen by going down this path.

I don't know much about aircraft sales deals, but given the heavy discounts some customers get (resulting in less revenue for the platemaker), it should be understandable for them to push that customers don't just cancel orders putting the platemakers themselves in jeopardy. If Airbus' approach was putting airlines out of business though, then yes that would be an abuse of their power.
 
accentra
Posts: 74
Joined: Wed Dec 15, 2021 11:35 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 6:29 pm

Gar1G wrote:
Opus99 wrote:
https://airinsight.com/iata-boss-worried-about-qatar-airbus-feud/

Interesting comments from WW here.

Talks about airbus exploiting their current market strength.

Talks about a long list of airlines that wanted to cancel contracts with airbus but Airbus did not allow them

Wants to see a strong Boeing and strong airbus

Etc etc


I'm wondering, would it have been inappropriate or a conflict of interest to get someone like WW to help mediate before it reached this stage?


WW is not a neutral. He was very much party to/facilitator for AAB/Qatar's purchase of the IAG stake. So not an unbiased participant/commentator.
 
majano
Posts: 463
Joined: Sun Oct 14, 2018 10:45 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 6:32 pm

Isn't Walsh the same guy who penned a now defunct LII with Boeing in the midst of the MAX scandal which cost hundreds of lives? So, in my view, it is not unlikely that his comments are less about QR and more about a stronger Boeing. That's what he says he wants in the end....
 
oldJoe
Posts: 1039
Joined: Fri Jan 10, 2020 11:04 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 7:03 pm

ElroyJetson wrote:
Opus99 wrote:
https://airinsight.com/iata-boss-worried-about-qatar-airbus-feud/

Interesting comments from WW here.

Talks about airbus exploiting their current market strength.

Talks about a long list of airlines that wanted to cancel contracts with airbus but Airbus did not allow them

Wants to see a strong Boeing and strong airbus

Etc etc


First of all, thanks for the link. As with so many statements from Corporate leaders you need to read as much between the lines as what is said.

Willie Walsh seems to be indicating Airbus has been playing hard ball with its customers during the pandemic. My impression is Airbus is not engendering warm fuzzy feelings among much of its customer base. This can often bite you in the ass down the road. We shall see.

I agree with Revelation. I think this is a fight between QR and Airbus that other airlines are watching very, very, closely. For QR to sue Airbus is a drastic step. For Airbus to cancel a valid contract for 50 aircraft is also a drastic step imho.

I make no predictions as to the Court case. To me there are too many unknown variables. However, I do predict the ramifications of this dispute once settled will be far reaching for for many years to come for both Airbus and the entire aviation industry. We are entering unprecedented territory.


What tells you that the contract for 50 A321 is still valid ? Remember when QR cancelled the whole order for A320`s ( of which already were six build ) they claimed about the engines ! Is the OEM responsible for this choice ? I guess not ! So if Airbus wants to get out of this hussle again than terminate the contract and I believe if they do this step because they know they legally can.
 
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Polot
Posts: 13120
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 7:10 pm

oldJoe wrote:
ElroyJetson wrote:
Opus99 wrote:
https://airinsight.com/iata-boss-worried-about-qatar-airbus-feud/

Interesting comments from WW here.

Talks about airbus exploiting their current market strength.

Talks about a long list of airlines that wanted to cancel contracts with airbus but Airbus did not allow them

Wants to see a strong Boeing and strong airbus

Etc etc


First of all, thanks for the link. As with so many statements from Corporate leaders you need to read as much between the lines as what is said.

Willie Walsh seems to be indicating Airbus has been playing hard ball with its customers during the pandemic. My impression is Airbus is not engendering warm fuzzy feelings among much of its customer base. This can often bite you in the ass down the road. We shall see.

I agree with Revelation. I think this is a fight between QR and Airbus that other airlines are watching very, very, closely. For QR to sue Airbus is a drastic step. For Airbus to cancel a valid contract for 50 aircraft is also a drastic step imho.

I make no predictions as to the Court case. To me there are too many unknown variables. However, I do predict the ramifications of this dispute once settled will be far reaching for for many years to come for both Airbus and the entire aviation industry. We are entering unprecedented territory.


What tells you that the contract for 50 A321 is still valid ? Remember when QR cancelled the whole order for A320`s ( of which already were six build ) they claimed about the engines ! Is the OEM responsible for this choice ? I guess not ! So if Airbus wants to get out of this hussle again than terminate the contract and I believe if they do this step because they know they legally can.

Very much depends on the contract. Remember Airbus is the one who selected which engines are available for the A320neo, not QR. Airbus is the one who makes performance guarantees…which are based on part on performance of engines.

Considering QR did not just outright cancel the A320neos, but rather replaced that original order with a new A321neo order, I doubt Airbus had zero problems with QR’s actions. The entire thing was likely negotiated between QR, Airbus, and PW where they came to a solution all parties were happy with.
 
smartplane
Posts: 1897
Joined: Fri Aug 03, 2018 9:23 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 8:26 pm

Polot wrote:
oldJoe wrote:
ElroyJetson wrote:

First of all, thanks for the link. As with so many statements from Corporate leaders you need to read as much between the lines as what is said.

Willie Walsh seems to be indicating Airbus has been playing hard ball with its customers during the pandemic. My impression is Airbus is not engendering warm fuzzy feelings among much of its customer base. This can often bite you in the ass down the road. We shall see.

I agree with Revelation. I think this is a fight between QR and Airbus that other airlines are watching very, very, closely. For QR to sue Airbus is a drastic step. For Airbus to cancel a valid contract for 50 aircraft is also a drastic step imho.

I make no predictions as to the Court case. To me there are too many unknown variables. However, I do predict the ramifications of this dispute once settled will be far reaching for for many years to come for both Airbus and the entire aviation industry. We are entering unprecedented territory.


What tells you that the contract for 50 A321 is still valid ? Remember when QR cancelled the whole order for A320`s ( of which already were six build ) they claimed about the engines ! Is the OEM responsible for this choice ? I guess not ! So if Airbus wants to get out of this hussle again than terminate the contract and I believe if they do this step because they know they legally can.

Very much depends on the contract. Remember Airbus is the one who selected which engines are available for the A320neo, not QR. Airbus is the one who makes performance guarantees…which are based on part on performance of engines.

Considering QR did not just outright cancel the A320neos, but rather replaced that original order with a new A321neo order, I doubt Airbus had zero problems with QR’s actions. The entire thing was likely negotiated between QR, Airbus, and PW where they came to a solution all parties were happy with.

Problem for customers who exploit contract loopholes, suggesting the failure to dot even just one 'i' correctly, gives them an escape route, is the tables can be turned.

A350 customers have been kept informed using similar NDA's and carrots, just as Boeing & RR did a few years earlier.

There are a myriad of suppliers hoping the courts decide in a particular direction. Not sure airlines have an opposing view.

Airbus has benefitted from it's market position, but isn't that precisely what airlines do with JV's and alliances, regulating capacity, and exploiting family bereavements, cancellations and last minute decisions to fly?
 
Lootess
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 8:33 pm

sxf24 wrote:
BoeingVista wrote:
sxf24 wrote:

QR says they were performing on the A321 contract and it’s not normal to link contracts for different models. Will be interesting what the court says or if Airbus actually cancelled the order and reallocated the slots (versus threatening to do so).

I hope this is resolved soon because Europe may need natural gas from Qatar.


There may be a clause in the A321 contract about QR remaining a customer "in good standing" if QR have defaulted on any payments to Airbus or deliveries on the A350 contract they would cease to be. One contract can easily be linked to or bleed over into another.


I do not think there’s such a clause and I do not think the order will actually be cancelled/debooked. Neither is consistent with the typical Airbus contract. Airbus has more discretion on the timing of deliveries and I would expect what they’ve really done is slide out indefinitely and keep the order on the books - can’t start the year negative!

I would expect cancellation of A350s for failure to accept delivery is within the contract. It limits Airbus’ ability to claim damages, but this seems to be more about teaching a customer a lesson - and sending a message to other customers to stay in line. Airlines and lessors are not happy with an OEM allowing a dispute to get to this point.


Failing to accept deliveries and putting your account with Airbus in-default would be grounds for cancelling other contracts. It's likely spelled out that way that not being in good standing defers the customer's rights to aircraft slots and production. Next there is probably a provision around disputes and what are the means to resolve, and going outside that parameter would also jeopardize account standing. It's not like the Airbus legal team had to dig up something small to hit them in the order book. There are a lot of circuit breakers in-favor of Airbus and protecting their brand.
 
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Polot
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 9:03 pm

smartplane wrote:
Polot wrote:
oldJoe wrote:

What tells you that the contract for 50 A321 is still valid ? Remember when QR cancelled the whole order for A320`s ( of which already were six build ) they claimed about the engines ! Is the OEM responsible for this choice ? I guess not ! So if Airbus wants to get out of this hussle again than terminate the contract and I believe if they do this step because they know they legally can.

Very much depends on the contract. Remember Airbus is the one who selected which engines are available for the A320neo, not QR. Airbus is the one who makes performance guarantees…which are based on part on performance of engines.

Considering QR did not just outright cancel the A320neos, but rather replaced that original order with a new A321neo order, I doubt Airbus had zero problems with QR’s actions. The entire thing was likely negotiated between QR, Airbus, and PW where they came to a solution all parties were happy with.

Problem for customers who exploit contract loopholes, suggesting the failure to dot even just one 'i' correctly, gives them an escape route, is the tables can be turned.

Failing to meet performance and reliability guarantees, along with delivery dates, is a pretty big dot to miss in a “loophole”. Ask old McDD guys about it in regards to the MD-11.

And again QR didn’t just escape their contract. They negotiated a new one that superseded the old one.
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 9:29 pm

Polot wrote:
Very much depends on the contract. Remember Airbus is the one who selected which engines are available for the A320neo, not QR. Airbus is the one who makes performance guarantees…which are based on part on performance of engines.

Considering QR did not just outright cancel the A320neos, but rather replaced that original order with a new A321neo order, I doubt Airbus had zero problems with QR’s actions. The entire thing was likely negotiated between QR, Airbus, and PW where they came to a solution all parties were happy with.


I don’t think your recollection is correct, QR walked away from the first contract when Airbus had a dozen of their aircraft in production.

QR was the customer faced with the choice of engine, they selected the P&W engine

Source :

https://www.aviationpros.com/aircraft/m ... aft-family

https://mobile.reuters.com/article/amp/idUSKCN0WB1GT
 
sxf24
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 9:39 pm

Lootess wrote:
sxf24 wrote:
BoeingVista wrote:

There may be a clause in the A321 contract about QR remaining a customer "in good standing" if QR have defaulted on any payments to Airbus or deliveries on the A350 contract they would cease to be. One contract can easily be linked to or bleed over into another.


I do not think there’s such a clause and I do not think the order will actually be cancelled/debooked. Neither is consistent with the typical Airbus contract. Airbus has more discretion on the timing of deliveries and I would expect what they’ve really done is slide out indefinitely and keep the order on the books - can’t start the year negative!

I would expect cancellation of A350s for failure to accept delivery is within the contract. It limits Airbus’ ability to claim damages, but this seems to be more about teaching a customer a lesson - and sending a message to other customers to stay in line. Airlines and lessors are not happy with an OEM allowing a dispute to get to this point.


Failing to accept deliveries and putting your account with Airbus in-default would be grounds for cancelling other contracts. It's likely spelled out that way that not being in good standing defers the customer's rights to aircraft slots and production. Next there is probably a provision around disputes and what are the means to resolve, and going outside that parameter would also jeopardize account standing. It's not like the Airbus legal team had to dig up something small to hit them in the order book. There are a lot of circuit breakers in-favor of Airbus and protecting their brand.


We do not know if there is a cross-default clause in the A350 and A321 purchase agreements. Even if there is, QR would argue that it is not in default under the A350 purchase agreement as aircraft do not meet delivery conditions.

This is not a black and white issue, despite it being portrayed as such.
 
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Polot
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 9:53 pm

zeke wrote:
Polot wrote:
Very much depends on the contract. Remember Airbus is the one who selected which engines are available for the A320neo, not QR. Airbus is the one who makes performance guarantees…which are based on part on performance of engines.

Considering QR did not just outright cancel the A320neos, but rather replaced that original order with a new A321neo order, I doubt Airbus had zero problems with QR’s actions. The entire thing was likely negotiated between QR, Airbus, and PW where they came to a solution all parties were happy with.


I don’t think your recollection is correct, QR walked away from the first contract when Airbus had a dozen of their aircraft in production.

QR was the customer faced with the choice of engine, they selected the P&W engine

Source :

https://www.aviationpros.com/aircraft/m ... aft-family

https://mobile.reuters.com/article/amp/idUSKCN0WB1GT

I don’t believe QR ever cancelled until the new order, the order remained on the books. And the second link says nothing about dozens of QR jets built, it says dozens of A320neos inclusive of various airlines.

In any event this is beside the point. It more how certain members here are using current events to rewrite history and act like QR was the problem child back then with the original A320neo order.

Let’s recap that era:
-QR had several dozen A320neos on order with engines with questionable reliability in their harsh operating environment and no chance of Airbus hitting delivery dates because of PW’s and CFM’s terrible engine ramp up.
-QR takes first A350XWB in late December 2014, EIS early 2015, when it was originally expected mid 2013 at launch. This is after QR was the launch customer of the stillborn A350mk1 in Summer 2005 with expected delivery in 2010.
-In late 2014 QR also takes their first A380s, after initially ordering them in 2001 with 2007 delivery (PR here: viewtopic.php?t=74147)

Looking back one might say QR had a lot of patience back then, and I’m not sure I’d label QR as the problem customer “exploiting loopholes”…
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 9:59 pm

sxf24 wrote:
Even if there is, QR would argue that it is not in default under the A350 purchase agreement as aircraft do not meet delivery conditions.


There is nothing presented in the QR court filings to suggest that the “aircraft do not meet delivery conditions”. QR is seeking an injunction in their court filing against accepting further aircraft (which triggers payments) until such time they are paid the monies they claim is owning to them.
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 10:36 pm

Polot wrote:
Let’s recap that era:
-QR had several dozen A320neos on order with engines with questionable reliability in their harsh operating environment and no chance of Airbus hitting delivery dates because of PW’s and CFM’s terrible engine ramp up.
-QR takes first A350XWB in late December 2014, EIS early 2015, when it was originally expected mid 2013 at launch. This is after QR was the launch customer of the stillborn A350mk1 in Summer 2005 with expected delivery in 2010.
-In late 2014 QR also takes their first A380s, after initially ordering them in 2001 with 2007 delivery (PR here: viewtopic.php?t=74147)

Looking back one might say QR had a lot of patience back then, and I’m not sure I’d label QR as the problem customer “exploiting loopholes”…


None of that is before the courts, so one has to assume that some form of amicable agreement was reached. If QR had selected the CFM engines, they could have had their NEOs in 2015/16. It was not like Airbus was unable to build the airframes. I just don’t know if they just really wanted the A321neo instead of the A320neo.

What is missing from your timeline is the high demand for aircraft during that period, this dispute occurred when there was no demand, to the point where jets were parked all over the world, and oil prices even went briefly negative.
 
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Polot
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 10:57 pm

zeke wrote:
Polot wrote:
Let’s recap that era:
-QR had several dozen A320neos on order with engines with questionable reliability in their harsh operating environment and no chance of Airbus hitting delivery dates because of PW’s and CFM’s terrible engine ramp up.
-QR takes first A350XWB in late December 2014, EIS early 2015, when it was originally expected mid 2013 at launch. This is after QR was the launch customer of the stillborn A350mk1 in Summer 2005 with expected delivery in 2010.
-In late 2014 QR also takes their first A380s, after initially ordering them in 2001 with 2007 delivery (PR here: viewtopic.php?t=74147)

Looking back one might say QR had a lot of patience back then, and I’m not sure I’d label QR as the problem customer “exploiting loopholes”…


None of that is before the courts, so one has to assume that some form of amicable agreement was reached. If QR had selected the CFM engines, they could have had their NEOs in 2015/16. It was not like Airbus was unable to build the airframes. I just don’t know if they just really wanted the A321neo instead of the A320neo.

What is missing from your timeline is the high demand for aircraft during that period, this dispute occurred when there was no demand, to the point where jets were parked all over the world, and oil prices even went briefly negative.

High (or low) demand does not absolve Airbus of contractual requirements. In fact because of the high demand some might view QR not taking early A320neos and going for later A321neos instead as a net positive for Airbus! Frees up engines during a time they were desperately needed and get a higher margin aircraft out of the airline.

Again all I’m pointing out is Airbus back then was not coming to the negotiating table as some innocent little victim with their hands clean being bullied by big bad QR. Airbus had plenty of issues that they (and PW), not QR, were responsible for.

This ties back to the fear some have that Airbus might be becoming too ‘arrogant’ or ‘abusing’ their market strength. Most of Airbus senior management have only been around for Airbus’s good times. They were not there when Airbus had to go to customers hat in hand and inform them that their plane is several years late because of development screwups (A380). They were not there when Airbus had to go to customers hat in hand to tell them they don’t want to build the plane that airline has firm orders for (A350mk1, A350XWB-800). Enders was nice enough to even officially kill off the A380 at the end of his term so Faury could start off with a clean slate.
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 11:20 pm

Polot wrote:
High (or low) demand does not absolve Airbus of contractual requirements.


Which contractural requirement was that ? The engine deal was between QR and P&W.

“ Akbar al-Baker said Airbus was not at fault and Qatar Airways will not shelve the aircraft order but the company may seek a new engine supplier.

"We will not cancel the (Airbus) neo order, our relationship with Airbus is very strong... but yes we could cancel the entire Pratt & Whitney order," he told reporters at the Singapore Airshow.”

From https://www.reuters.com/article/us-sing ... SKCN0VP0S8

Polot wrote:
This ties back to the fear some have that Airbus might be becoming too ‘arrogant’ or ‘abusing’ their market strength.


Where is the evidence of this ? Airbus did renegotiate many deliveries whilst at the same time told airlines it need to still make some deliveries in order to keep the production lines open. How is that unreasonable?

I would gladly welcome you to talk to employees of Airbus and QR, and see what their perspectives are of their employer is. Ask them directly if they would describe their employer as “too ‘arrogant’ or ‘abusing’” (your words not mine).
 
sxf24
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 11:24 pm

zeke wrote:
sxf24 wrote:
Even if there is, QR would argue that it is not in default under the A350 purchase agreement as aircraft do not meet delivery conditions.


There is nothing presented in the QR court filings to suggest that the “aircraft do not meet delivery conditions”. QR is seeking an injunction in their court filing against accepting further aircraft (which triggers payments) until such time they are paid the monies they claim is owning to them.


I was suggesting a potential basis for not accepting A350 deliveries, not summarizing arguments made thus far in the court case.

The point you choose to exclude from the quote remains relevant: this is not a black and white issue. I would also expect there is merit in both sides’ legal arguments. If one party had no basis for their position, I would have expected them to cave by now.
 
sxf24
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 11:29 pm

zeke wrote:
Polot wrote:
This ties back to the fear some have that Airbus might be becoming too ‘arrogant’ or ‘abusing’ their market strength.


Where is the evidence of this ? Airbus did renegotiate many deliveries whilst at the same time told airlines it need to still make some deliveries in order to keep the production lines open. How is that unreasonable?

I would gladly welcome you to talk to employees of Airbus and QR, and see what their perspectives are of their employer is. Ask them directly if they would describe their employer as “too ‘arrogant’ or ‘abusing’” (your words not mine).


This is an opinion that I have consistently and repeatedly heard from airlines and lessors. I’m not sure why an employee’s perception of their employer is relevant, particularly in a discussion about how customers feel said employees are treating them. What’s relevant to this thread, is that AAB and QR apparently share this opinion.

I would point out that one reason airlines and lessors feel Airbus is being arrogant is that Boeing has bent over backwards during the pandemic to accommodate customers. Of course, Boeing had to because of the disruption created by the MAX grounding and 787 delivery delays that have also given Airbus the confidence to take harder lines.
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 11:41 pm

sxf24 wrote:
The point you choose to exclude from the quote remains relevant: this is not a black and white issue. I would also expect there is merit in both sides’ legal arguments.


This is new a new point, I have stated this numerous times on this thread. I have read the court filings and the first order made last week. Everything so far is one sided.

At this stage of the proceedings no evidence has been presented, just claims from QR. There has been no documentation between the parties presented, there has been no documents from the Qatar CAA presented, no maintenance records presented, no repair schemes presented etc etc.

Airbus has until the end of the month to make its submission.
 
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Polot
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 11:49 pm

sxf24 wrote:
zeke wrote:
Polot wrote:
This ties back to the fear some have that Airbus might be becoming too ‘arrogant’ or ‘abusing’ their market strength.


Where is the evidence of this ? Airbus did renegotiate many deliveries whilst at the same time told airlines it need to still make some deliveries in order to keep the production lines open. How is that unreasonable?

I would gladly welcome you to talk to employees of Airbus and QR, and see what their perspectives are of their employer is. Ask them directly if they would describe their employer as “too ‘arrogant’ or ‘abusing’” (your words not mine).


This is an opinion that I have consistently and repeatedly heard from airlines and lessors. I’m not sure why an employee’s perception of their employer is relevant, particularly in a discussion about how customers feel said employees are treating them. What’s relevant to this thread, is that AAB and QR apparently share this opinion.

I would point out that one reason airlines and lessors feel Airbus is being arrogant is that Boeing has bent over backwards during the pandemic to accommodate customers. Of course, Boeing had to because of the disruption created by the MAX grounding and 787 delivery delays that have also given Airbus the confidence to take harder lines.

And Willie Walsh was directly asked about it in an interview posted today, which is what I was alluding to with my statement. Here’s the link for those who missed it (was posted earlier in thread):
https://airinsight.com/iata-boss-worrie ... rbus-feud/
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Tue Jan 25, 2022 11:50 pm

sxf24 wrote:
I’m not sure why an employee’s perception of their employer is relevant, particularly in a discussion about how customers feel said employees are treating them.

I would point out that one reason airlines and lessors feel Airbus is being arrogant is that Boeing has bent over backwards during the pandemic to accommodate customers. Of course, Boeing had to because of the disruption created by the MAX grounding and 787 delivery delays that have also given Airbus the confidence to take harder lines.


Beucase the way leadership treats internal suppliers (employees) is generally the same way they treat external suppliers.

As you said , the pandemic was kind for Boeing, they had problems across the board with the 737, 787, 777. They were in no position not to accommodate.
 
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zeke
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Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 12:03 am

Polot wrote:
And Willie Walsh was directly asked about it in an interview posted today, which is what I was alluding to with my statement. Here’s the link for those who missed it (was posted earlier in thread):
https://airinsight.com/iata-boss-worrie ... rbus-feud/


How many of those 100 airlines that would have liked to cancel contacts have taken to the press to embarrass the OEM ?

Why didn’t QR just cancel the contract for the A350, why are they taking they strategy they have embarked on ?

How many other airlines are seeking over a billion dollars from the OEM ?

Are you suggesting the path QR took never received legal advice that this could end the relationship with the supplier, and contracts cancelled ?
 
sxf24
Posts: 1796
Joined: Wed Aug 15, 2007 12:22 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 12:07 am

zeke wrote:
sxf24 wrote:
The point you choose to exclude from the quote remains relevant: this is not a black and white issue. I would also expect there is merit in both sides’ legal arguments.


This is new a new point, I have stated this numerous times on this thread. I have read the court filings and the first order made last week. Everything so far is one sided.

At this stage of the proceedings no evidence has been presented, just claims from QR. There has been no documentation between the parties presented, there has been no documents from the Qatar CAA presented, no maintenance records presented, no repair schemes presented etc etc.

Airbus has until the end of the month to make its submission.


The initial complaint is just that - the first argument laying out the case. Your setting up unrealistic expectations of what information would be publicly viewable at this juncture.

zeke wrote:
sxf24 wrote:
I’m not sure why an employee’s perception of their employer is relevant, particularly in a discussion about how customers feel said employees are treating them.

I would point out that one reason airlines and lessors feel Airbus is being arrogant is that Boeing has bent over backwards during the pandemic to accommodate customers. Of course, Boeing had to because of the disruption created by the MAX grounding and 787 delivery delays that have also given Airbus the confidence to take harder lines.


Beucase the way leadership treats internal suppliers (employees) is generally the same way they treat external suppliers.

As you said , the pandemic was kind for Boeing, they had problems across the board with the 737, 787, 777. They were in no position not to accommodate.


Let me get this straight: instead of acknowledging opinions shared by other posters or unambiguous comments made by Willy Walsh, you’re going to try and gaslight us into thinking our opinions are invalid because we haven’t talked to Airbus employees?

But, hey. I have talked to Airbus employees and suppliers are the assessment is the same: the leadership is taking a much more aggressive position with the viewpoint that stakeholders must cooperate with Airbus because they are (currently) the market leader.
 
User avatar
Polot
Posts: 13120
Joined: Thu Jul 28, 2011 3:01 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 12:22 am

zeke wrote:
Polot wrote:
And Willie Walsh was directly asked about it in an interview posted today, which is what I was alluding to with my statement. Here’s the link for those who missed it (was posted earlier in thread):
https://airinsight.com/iata-boss-worrie ... rbus-feud/


How many of those 100 airlines that would have liked to cancel contacts have taken to the press to embarrass the OEM ?

Why didn’t QR just cancel the contract for the A350, why are they taking they strategy they have embarked on ?

How many other airlines are seeking over a billion dollars from the OEM ?

Are you suggesting the path QR took never received legal advice that this could end the relationship with the supplier, and contracts cancelled ?

I don’t know. None of these questions directly address comments in the interview, my comments about possible Airbus perceptions, prove or disprove anything, and are just attempts to shift topic to something else.

It is entirely possible for an airline to follow a contract but still be privately unhappy about it you know. That may influence how they approach future contracts with the same party.
Last edited by Polot on Wed Jan 26, 2022 12:26 am, edited 1 time in total.
 
User avatar
hongkongflyer
Posts: 928
Joined: Tue Oct 28, 2014 8:23 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 2:08 am

zeke wrote:
Polot wrote:
One of the types of damage QR had in their court filings related to the edges of dark and light livery changes, the style of livery I trust you would agree is a choice the operator makes, not the OEM.


Finally I know why many airlines now go for an Europe-White livery because the plane manufacturer can't make a fuselage that can have the edges of dark and light livery changes....

The only civil plane that have restrictions on the livery is Concorde but it is a supersonic plane that flying faster then the sound.
 
smartplane
Posts: 1897
Joined: Fri Aug 03, 2018 9:23 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 3:24 am

zeke wrote:
Polot wrote:
Very much depends on the contract. Remember Airbus is the one who selected which engines are available for the A320neo, not QR. Airbus is the one who makes performance guarantees…which are based on part on performance of engines.

Considering QR did not just outright cancel the A320neos, but rather replaced that original order with a new A321neo order, I doubt Airbus had zero problems with QR’s actions. The entire thing was likely negotiated between QR, Airbus, and PW where they came to a solution all parties were happy with.


I don’t think your recollection is correct, QR walked away from the first contract when Airbus had a dozen of their aircraft in production.

QR was the customer faced with the choice of engine, they selected the P&W engine.

Not only did they select from a choice of two, but QR were one of the very first airlines, ever, to negotiate directly with an engine OEM (for NB aircraft) in the 21st century. Boeing and other engine OEM's felt Airbus created an unfortunate precedent.
 
tommy1808
Posts: 14894
Joined: Thu Nov 21, 2013 3:24 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 5:59 am

ElroyJetson wrote:
Opus99 wrote:
https://airinsight.com/iata-boss-worried-about-qatar-airbus-feud/

Interesting comments from WW here.

Talks about airbus exploiting their current market strength.

Talks about a long list of airlines that wanted to cancel contracts with airbus but Airbus did not allow them

Wants to see a strong Boeing and strong airbus

Etc etc


First of all, thanks for the link. As with so many statements from Corporate leaders you need to read as much between the lines as what is said.

Willie Walsh seems to be indicating Airbus has been playing hard ball with its customers during the pandemic.


You make it sound like Airbus forced its customers to pick up Aircraft no matter what, and Boeing customers just called "Hey, about that frame we are supposed to pick up in three month, can we postpone that by two years? Yes? Cool. Give my regards to wife and kids......".

Airbus did cut production rate across the board for anything but the A220, so quite obviously not all customers where forced to take up their aircraft. There was a quote some time ago, i think it was from Lufthansa, along the lines of "they always asked for something in return, a top up order or something". And apparently some customers walked away from that with a deal they could live with.

Boeing had the same discussion with its customers in the last two years, the major difference being that every single of Boeings customers could start the discussion with either

a) "About the compensations for the 737max grounding"
b) "About the compensation for the 777x delays"
c) "About the compensation for the 787 delays"

Their customers just had much, much more leverage to get deliveries postponed on the cheap, if the upcoming delivery was even possible .....

best regards
Thomas
 
Duke91
Posts: 144
Joined: Tue Jul 06, 2021 4:02 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 6:11 am

In germany the saying is: Das Leben ist kein Ponyhof (live is not a pony ranch).
 
Lootess
Posts: 822
Joined: Sun May 13, 2018 6:15 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 7:00 am

zeke wrote:
sxf24 wrote:
Even if there is, QR would argue that it is not in default under the A350 purchase agreement as aircraft do not meet delivery conditions.


There is nothing presented in the QR court filings to suggest that the “aircraft do not meet delivery conditions”. QR is seeking an injunction in their court filing against accepting further aircraft (which triggers payments) until such time they are paid the monies they claim is owning to them.


Correct, QR is trying to hold up delivery, but there is no cited delivery faults in the injunction because they have no case for such. We all know a customer can't hold up aircraft delivery because they don't want to pay per the agreed upon delivery schedule.

This is all going to come out that QR set off circuit breakers that put them in default and it's not going to end well.
 
User avatar
BoeingVista
Posts: 2112
Joined: Mon Jan 12, 2009 9:54 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 11:15 am

sxf24 wrote:
Lootess wrote:
sxf24 wrote:

I do not think there’s such a clause and I do not think the order will actually be cancelled/debooked. Neither is consistent with the typical Airbus contract. Airbus has more discretion on the timing of deliveries and I would expect what they’ve really done is slide out indefinitely and keep the order on the books - can’t start the year negative!

I would expect cancellation of A350s for failure to accept delivery is within the contract. It limits Airbus’ ability to claim damages, but this seems to be more about teaching a customer a lesson - and sending a message to other customers to stay in line. Airlines and lessors are not happy with an OEM allowing a dispute to get to this point.


Failing to accept deliveries and putting your account with Airbus in-default would be grounds for cancelling other contracts. It's likely spelled out that way that not being in good standing defers the customer's rights to aircraft slots and production. Next there is probably a provision around disputes and what are the means to resolve, and going outside that parameter would also jeopardize account standing. It's not like the Airbus legal team had to dig up something small to hit them in the order book. There are a lot of circuit breakers in-favor of Airbus and protecting their brand.


We do not know if there is a cross-default clause in the A350 and A321 purchase agreements. Even if there is, QR would argue that it is not in default under the A350 purchase agreement as aircraft do not meet delivery conditions.

This is not a black and white issue, despite it being portrayed as such.


I wouldn't be a "cross default clause" tied to the two contracts it would be, as I said, a clause that requires a customer to remain in good standing with Airbus or Airbus would be entitled to do X.

The law is rarely black and white, nobody who knows anything about the law ever claims it is.

But, it would be insane for an OEM to accept multiple billion dollar contracts without requiring a customer to remain paying etc, on all of them. QR (to take a random example) tries to screw them for billions but they are still required to spend billions on the next order so that QR can try and screw them for billions again in 5 years? Nah, billion dollar enterprises are smarter than that.
 
User avatar
BoeingVista
Posts: 2112
Joined: Mon Jan 12, 2009 9:54 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 11:26 am

Lootess wrote:

Failing to accept deliveries and putting your account with Airbus in-default would be grounds for cancelling other contracts. It's likely spelled out that way that not being in good standing defers the customer's rights to aircraft slots and production. Next there is probably a provision around disputes and what are the means to resolve, and going outside that parameter would also jeopardize account standing. It's not like the Airbus legal team had to dig up something small to hit them in the order book. There are a lot of circuit breakers in-favor of Airbus and protecting their brand.


Yes, all of this.

There seems to be a lot of fantasy here that QR can shrug this off and get paid by Airbus to take 50 A321's, not going to happen. QR have to have a serious think about if this stupidity is going to derail their medium / long term corporate strategy, they had better hope that Airbus still want to pick up the phone and work out a settlement but after the video I doubt it they will want to be vindicated in court.
 
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MrBren
Posts: 384
Joined: Wed Jun 15, 2016 11:44 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 1:04 pm

So good luck for QR to deal with one single supplier and good luck for Boeing to deal with angry AAB.
 
sxf24
Posts: 1796
Joined: Wed Aug 15, 2007 12:22 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 1:11 pm

BoeingVista wrote:
sxf24 wrote:
Lootess wrote:

Failing to accept deliveries and putting your account with Airbus in-default would be grounds for cancelling other contracts. It's likely spelled out that way that not being in good standing defers the customer's rights to aircraft slots and production. Next there is probably a provision around disputes and what are the means to resolve, and going outside that parameter would also jeopardize account standing. It's not like the Airbus legal team had to dig up something small to hit them in the order book. There are a lot of circuit breakers in-favor of Airbus and protecting their brand.


We do not know if there is a cross-default clause in the A350 and A321 purchase agreements. Even if there is, QR would argue that it is not in default under the A350 purchase agreement as aircraft do not meet delivery conditions.

This is not a black and white issue, despite it being portrayed as such.


I wouldn't be a "cross default clause" tied to the two contracts it would be, as I said, a clause that requires a customer to remain in good standing with Airbus or Airbus would be entitled to do X.

The law is rarely black and white, nobody who knows anything about the law ever claims it is.

But, it would be insane for an OEM to accept multiple billion dollar contracts without requiring a customer to remain paying etc, on all of them. QR (to take a random example) tries to screw them for billions but they are still required to spend billions on the next order so that QR can try and screw them for billions again in 5 years? Nah, billion dollar enterprises are smarter than that.


The clause you described is commonly called cross-default: if you fail to perform on one contract (a default), you are automatically in default on all contracts. Airlines hate these because missing a small payment for a part would be a default, even if it was an honest mistake. So, most airlines will negotiate hard to limit or exclude. We don’t know what is in QR’s contract.

I suspect some of the arguments in court will be whether Airbus failed to perform first, absolving QR of its obligations or vice versa.

Oh, OEMs have separate contracts for some of their largest customers. That’s what the customers will accept.
 
peterinlisbon
Posts: 1987
Joined: Wed Feb 01, 2006 3:37 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 5:04 pm

They better not annoy Boeing or they'll end up flying turboprops.
 
Opus99
Posts: 3175
Joined: Thu May 30, 2019 10:51 pm

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 5:05 pm

https://twitter.com/qatarairways/status ... 49985?s=21

Why does this tweet feel like it carries so much shade
 
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SQ22
Moderator
Posts: 2704
Joined: Sat Feb 25, 2012 9:29 am

Re: Qatar and Airbus Legal Dispute Continues - Airbus Revokes A321 Order

Wed Jan 26, 2022 5:11 pm

This thread has run its course and will be locked. Feel free to start a new thread when there are any further news wevolving.
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