Tag: Gulf (Page 2 of 2)

Is The Airbus A380 About To Have Its Life Support Pulled?

January 31, 2019 / WIL BALDWIN

PARIS/DUBAI (Reuters) – Dubai’s Emirates is exploring switching some orders for the world’s largest jetliner, the Airbus A380, to the smaller A350 in a move raising new doubts about the future of Europe’s superjumbo, people familiar with the matter said.

The Gulf carrier, which has invested tens of billions of dollars in more than 100 A380s, has been struggling to finalise a deal to buy another 36 to keep assembly lines open, due to differences with engine maker Rolls-Royce.

Now, Airbus is looking closely at closing A380 factories sooner than expected as part of a reshuffle of orders, with Chief Executive Tom Enders unlikely to leave the situation unresolved when his mandate ends in April, they said.

A person familiar with the matter said Airbus was looking “extremely seriously” at setting the timetable for a shutdown but said no decision had been taken.

Airbus said in a statement after Reuters first published news of the talks that it “confirms it is in discussions with Emirates airline in relation to its A380 contract”. But it said details of negotiations were confidential.

Emirates and Rolls-Royce declined to comment.

Emirates announced the deal for up to 36 aircraft worth as much as $16 billion (£12 billion) at list prices a year ago, throwing a lifeline to the programme’s roughly 3,000 workers and securing its future for at least another decade.

The airline is an ardent supporter of the jet, which was designed with luxury features like bars and showers.

But sales of four-engined planes are tumbling as many airlines switch to smaller twin-engined jets like the A350 and Boeing 777 due to improvements in range and efficiency.

A year-long impasse between Emirates and Rolls-Royce over shortfalls in fuel savings has so far blocked the order.

Airbus is trying to broker a complex workaround which could see Emirates take smaller jets also powered by Rolls-Royce while it tries to secure homes for as many A380s as possible, with British Airways recently expressing interest.

Airbus has dangled the prospect of closing A380 production before, and industry sources say such manoeuvres can be a negotiating tactic to force the feuding parties to agree.

But time is running out for the A380 with few airlines willing to spend the sums invested by Emirates, which has made it a backbone of its global network alongside the Boeing 777.

The production line is “untenable”, a senior industry source said

A decision by Emirates to order the A350 would offer a respite for Airbus and its main engine partner Rolls-Royce after the Gulf carrier axed an order for the A380 in 2014.

Airbus and Rolls are keen to maintain a foothold with the Gulf carrier and prevent Boeing filling the gap with more of its General Electric-powered 777s.

(Reporting by Tim Hepher and Alexander Cornwell; Editing by Michel Rose and Edmund Blair)

Image from Airbus

Qatar Airways acquires 5% of China Southern Airlines

January 2, 2019 / WIL BALDWIN

DUBAI/BEIJING, Jan 2 (Reuters) – Qatar Airways has acquired a 5 percent stake in China Southern Airlines, the state-owned Gulf carrier said on Wednesday, in a move to gain access to the fast-growing mainland Chinese market.

Qatar Airways also owns a 20 percent stake in British Airways-parent International Consolidated Airlines Group, 10 percent of South America’s LATAM Airlines Group SA , 49 percent of Italy’s Meridiana and 9.99 percent stake in Hong Kong’s Cathay Pacific.

Qatar’s flagship airline has sought new partners and routes after it was blocked last year from flying to the lucrative markets of Saudi Arabia and the United Arab Emirates because of restrictions imposed by those countries.

Saudi Arabia, UAE, Bahrain and Egypt, imposed a political and economic boycott on Qatar since June 2017, accusing it of supporting terrorism, which Doha denies.

China Southern in a separate statement said Qatar Airways may consider increasing its stake in the airline in the next 12 months. Qatar had no previous investment in the Chinese airline.

Qatar Airways is the second foreign carrier that has a stake in China Southern, after American Airlines. The Chinese carrier left the Skyteam airline alliance at the start of the year.

There are opportunities for “us to work together and build a long term relationship in ways that would bring benefits to customers of both airlines,” said Qatar Airways’ Chief Executive Akbar al-Baker.

Ajith K, director of Asia transport at UOB Kay Hian, said given that China Southern is the biggest competitor of Cathay Pacific in Greater China, this deal could strengthen the China Southern’s position at the Hong-Kong carrier’s expense. “Why Qatar is doing this, seems to me, one of course is to gain access to the Chinese market. Secondly it’s probably that they are hedging against their bet given they own almost 10 percent in Cathay Pacific.”

(Reporting by Asma Alsharif and Saeed Azhar in Dubai and Stella Qiu in Beijing; editing by Louise Heavens)

Image from http://www.boeing.com

Air Italy Flights Rekindle U.S. Carrier Anger

December 19, 2018 / WIL BALDWIN

ROME (Reuters) – Air Italy will start flying to Chicago next year, a move likely to revive a dispute between its minority shareholder Qatar Airways and U.S rivals trying to squeeze Gulf operators out of their domestic market.

Formerly known as Meridiana, Air Italy is the country’s second-largest airline, behind ailing Alitalia [CAITLA.UL], and state-owned Qatar Airways holds a 49 percent stake in it.

Air Italy will fly to Chicago three times a week from Milan Malpensa airport starting from May 14, 2019, Chief Operating Officer Rossen Dimitrov told Reuters.

Since 2015 the largest U.S carriers — Delta Air Lines (DAL.N), American Airlines Group (AAL.O) and United Airlines (UAL.N) — have argued their Gulf rivals are being unfairly subsidised by their governments, distorting competition.

Gulf airlines have always denied those accusations and in May the companies reached a voluntary agreement, saying they would not add new flights to the United States.

However, Air Italy has been flying to New York and Miami since June and will start serving San Francisco and Los Angeles from April 2019.

That has drawn criticism from an alliance of U.S.-based airlines grouped in the “Partnership for Open & Fair Skies”, that Qatar Airways is using Air Italy to offer additional flights between the U.S. and Europe, despite the agreement.

“Once again, Qatar is using Air Italy as a Trojan horse built from subsidized cash to avoid its commitments to the Trump administration and launch new … routes,” said Scott Reed, campaign manager for the Partnership for Open & Fair Skies.

In an emailed statement, Reed called on U.S. President Donald Trump to intercede on the behalf of U.S. airlines.

Dimitrov tried to dismiss any suggestion that Air Italy was acting improperly, noting that Qatar Airways was a minority shareholder.

“They do not dictate what we do and where we go. They do not manage us,” he said.

He added that he would be happy to work with the U.S airlines under code-share agreements, from which both sides would benefit, “rather than spending time and money fighting each other”.

The opening of the Chicago route next year is part of a wider plan, announced in May, in which the airline aims to grow its fleet and passenger numbers fourfold by 2022.

(Reporting by Giulia Segreti and Alberto Sisto; Editing by Keith Weir and Crispian Balmer)

Image from http://www.airitaly.com

Is The Airbus A380 About To Have Its Life Support Pulled?

Qatar Airways acquires 5% of China Southern Airlines

Air Italy Flights Rekindle U.S. Carrier Anger

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