Boeing had hoped to win over AirAsiaX, the long-haul unit of Malaysia-based AirAsia, as part of its strategy to squelch sales of the A330neo and widen the market for its proposed 797 small widebody jet.
Boeing’s major push to have a key Airbus A330neo customer defect to the 787 Dreamliner went right down to the wire, but at the last minute Airbus turned back the U.S. effort — at some considerable cost.
On Thursday, the final business day of the Farnborough Air Show, new Airbus sales chief Eric Schulz finally breathed a sigh of relief and secured his key A330neo order with AirAsiaX, the long-haul unit of Malaysia-based AirAsia.
AirAsiaX “reconfirmed” its previous order for 66 A330neos, which Airbus had already listed as a firm order, and added 34 more to swell the order to 100 aircraft.
Schulz declared himself “ecstatic.”
Most Read Business Stories
- FBI joining criminal investigation into certification of Boeing 737 MAX
- Flawed analysis, failed oversight: How Boeing, FAA certified the suspect 737 MAX flight control system | Times Watchdog
- Doomed jets lacked 2 key safety features that Boeing sold only as extras
- $12 million Belltown penthouse, used as a second home, is region's priciest condo sale ever
- Alaska Air Group declares support for Boeing during 'an incredibly difficult time'
However, Airbus had to give concessions, apparently including the likely cancellation of a separate firm order for 10 widebody A350s, ordered at the Paris Air Show back in 2009.
Following a week of intense negotiations, AirAsiaX chief executive Kamarudin Meranun and chairwoman Rafidah Aziz were open about AirAsia’s dalliance with Boeing and how they used it to get leverage with Airbus.
At a press conference, Kamarudin said he was transparent with Airbus and told Schulz about his negotiations with Boeing.
He said whether AirAsiaX would actually take the original order for 66 aircraft, which it placed four years ago at Farnborough as a launch customer for the A330neo, was “part of the negotiation” for the additional 34 jets.
“The buyer always has options. We had to weigh our options very carefully,” Rafidah said.
Schulz said that as a launch customer, AirAsiaX committed to the airplane before the design was final and real performance data was available, and so a reassessment was reasonable.
A couple of days earlier, Boeing privately still expressed hopes of snatching a last-minute victory with an offer of 787-10s; squelching sales of the A330neo is strategically important for its proposed 797. With that pressure, Airbus must have given AirAsiaX a great deal.
Schulz said AirAsia Group chief executive Tony Fernandes was involved in the negotiations. However, Fernandes remained in Malaysia and didn’t appear at Farnborough.
In Kuala Lumpur Thursday, Fernandes was quoted in the press as saying that now AirAsiaX would not take the A350s it ordered nine years ago.
Asked about this at the press conference, Schulz said that the A330neo order, newly expanded to 100 jets, may fill Fernandes’s need for widebodies.
“When you order 100 widebodies, the next 10 are questionable,” Schulz said.
Removing those A350s from the Airbus order book would still leave AirAsia with a backlog of more than 450 Airbus airplanes on order.
If AirAsia had switched the order to Boeing, including the original order for 66, it would have been a huge blow for the A330neo, which has lost several sales campaigns to the 787 this year and is low on orders just ahead of entering service.
“Losing 66 would have been difficult,” Schulz conceded in an interview. “I am happier to keep it.”
However, clinging on, barely, to a longtime customer hardly means the A330neo has great sales momentum. Aside from the AirAsia deal, it won just two small orders for a total of 8 airplanes at the Air Show.
Schulz said he’s confident the plane will gain more sales later in the year.