News from Indonesia does not look good for Airbus. Despite the fact that the A350 flight test program was completed without any major hitches, deliveries have been slow. However, orders have been even slower. In 2014 and 2015 Airbus has seen negative net orders for the A350. Recently, at Airbus’ request, Singapore Airlines handed back seven delivery slots. This effectively reduced Singapore’s orders for the aircraft.
Recently IAG ordered eight A350-900s for Iberia. IAG’s airlines (British Airways, Iberia and Vueling) operate nearly many Airbus types, from the A318 to the A380. Meanwhile Airbus continues to compete vigorously with Boeing wherever opportunities pop up – there is a competition underway at China Eastern at present. Emirates is another opportunity that is quietly being fought over.
The Garuda deal being cancelled will be unpleasant and it looks like going that way as the Indonesian president apparently supports this. Even if the airline decides to replace the A350s with A320s, Airbus loses as the deal value will go down. No doubt Airbus would prefer to see this A350 order slide to the right by seven years than be cancelled. Meanwhile Garuda could focus on acquiring A320s as its Minister suggests. Intriguingly the airline’s VP for PR is quoted as saying the A350 order was only an LoI and they might still consider 787s. Another game of chicken ensues.