A Loyal Boeing Customer in China Is Turning to Airbus
Xiamen Airlines Co. has operated only Boeing Co. aircraft since it started out in the 1980s.
(Bloomberg) --
Xiamen Airlines Co. has operated only Boeing Co. aircraft since it started out in the 1980s. Now the Chinese carrier is turning to rival Airbus SE, inviting bids from leasing companies to supply 10 A321neo jets.
Xiamen Airlines, majority owned by state-run China Southern Airlines Co., is planning for deliveries from the second half of next year to 2023, it said in a statement. The company has been in talks with Airbus as China and the U.S. waged a trade dispute and Boeing lunged into crisis with the global grounding of its 737 Max following two fatal crashes.
Xiamen Airlines’ decision is another blow to embattled Boeing, which this week said its deliveries slumped to 380 jetliners in 2019. Airbus smashed that number with 863 deliveries. Malaysia Airlines Bhd. on Wednesday suspended deliveries of the 737 Max jets it had on order for this year, becoming the first Southeast Asia carrier to take such a step.
Boeing had a loyal customer in Xiamen Airlines, which has more than 170 of the U.S. manufacturer’s aircraft in its fleet, including the 787 Dreamliner. One silver lining for Boeing could be the first phase of a broader trade pact between the U.S. and China released on Wednesday. The text of the pact specifies $77.7 billion in additional Chinese purchases of manufactured goods including aircraft, though it didn’t go into detail.
Airbus is “delighted” its aircraft are being considered by Xiamen Airlines, a spokesman of the planemaker said in an emailed response to questions.
Airbus executives met with Chinese customers in May to revive prospects for an unrelated $18 billion deal, according to a Bloomberg News report at the time. The Chinese government, which negotiates its aircraft deals via a central purchasing group, typically splits orders between the two planemakers to meet its rapid expansion goals.
--With assistance from Haze Fan and Siddharth Philip.
To contact the reporter on this story: Anurag Kotoky in New Delhi at akotoky@bloomberg.net
To contact the editors responsible for this story: Young-Sam Cho at ycho2@bloomberg.net, Will Davies, Subramaniam Sharma
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