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A3XX APPROVED AT LAST

On 23 June Airbus shareholders DASA, Aérospatiale-Matra, BAE Systems and CASA finally gave the authorisation to offer, allowing the company to negotiate with launch customers for the A3XX. Airbus Industrie managers can now make firm offers for the A3XX to the airlines which have expressed an interest in purchasing this four-engined ultra-large airliner which, with 555 passengers in a typical three-class configuration and a maximum take-off weight of 540,000kg (1,190,000lb), will be breaking new ground in commercial aircraft construction.

If the company wins enough firm orders for the A3XX, Airbus Industrie will officially launch the programme, which it is estimated will cost over $12 billion (around DM 24 billion). This is expected to occur in the last quarter of 2000 or the first quarter of 2001.

By then, Airbus is expected to have been reorganised into a single corporate entity called Airbus Integrated Company (AIC), owned by just two shareholders, EADS and BAE Systems. DASA, Aérospatiale and CASA have announced 10 July as the date on which they will merge into EADS, which will then be the third largest aerospace company in the world after Boeing and Lockheed-Martin.

Despite all the resistance that had to be overcome, the Airbus A3XX has accelerated the process of consolidation in the European aerospace industry. Without this mega-project the formation of AIC, which has been under discussion for years, would no doubt have continued as merely a discussion point for years to come. According to industry sources it seems that British Airbus partner, BAE Systems, was the prime mover in pressing for establishment of AIC to coincide with the launch of the A3XX programme. In this way the Airbus mega-airliner has helped all the parties involved to set the priorities that were necessary to make the European aerospace industry more competitive and carry it forward to a new era.

Interest in the A3XX is running surprisingly high amongst the airlines and leasing companies. To date Airbus Industrie has received letters of interest from eight airlines for around 60 firm orders for the aircraft, whose flyaway price is expected to be between $216 and $230 million. As well as Emirates, Virgin Atlantic, Singapore Airlines and Air France, leasing giant ILFC has also declared an interest. Three other potential customers have chosen to remain anonymous up to now. If development proceeds according to plan, the first A3XX will head for the runway in Toulouse in 2004, with first delivery to a customer following certification in 2005. Successful entry into service of the giant Airbus will mark an end to the monopoly Boeing has enjoyed for over 30 years with the 747 and to a success story that is without compare in commercial air transport.

While European governments have welcomed the Airbus decision, the US government is eyeing it with suspicion. The Boeing 747 earns billions of dollars every year, making it a critical ingredient to the health of the American trade balance. The US Trade Representative Charlene Barshefsky gave a foretaste of the flak Airbus can expect from the US government during a conference in Paris when, according to a news agency report, she said that the financing of the A3XX would have to be examined to verify that it complies with the World Trade Organisation's rules on subsidies. The German and British governments had been asked to come open about the financing arrangements for the A3XX and the Americans were still waiting for replies.

Airbus Industrie and the governments of the Airbus partner countries would be well advised not take the coming dispute lightly. In the medium term the USA remains the most important air transport market in the world and, as such, it has the muscle to determine the success or failure of this important programme.

From page 6 of FLUG REVUE 8/2000