The legal dispute between Qatar Airways and Airbus over the paint quality issues of the A350 is set to be delayed by another year. Unless the two parties find a way to settle the case earlier, a three-month expedited trial will be scheduled in June 2023. Qatar Airways and Airbus dispute set to continue in June 2023.
A division of the London High Court today (May 26) ruled on the timetable for the dispute, which has been dragging on since early 2021. Back then, the rift between the airline and airframer surfaced in the media. In August 2021, Qatar Airways openly condemned Airbus for not taking seriously the paint quality issue and the subsequent degradation of the composite structure and lightning protection of the airframe. The airline and the Qatari regulatory agency say the issue is a safety issue, which has resulted in the grounding of 23 A350s. Qatar Airways said in December that it would seek a ruling from the London High Court.
Airbus has said on numerous occasions that the issue is not affecting the airworthiness of the A350, which it backs with a review by the European regulatory agency EASA. The airframer offered an independent legal assessment and remained open to a settlement with Qatar, but the airline rebuffed this. Airbus says that the carrier has made inaccurate statements on the degradation that are damaging to the reputation of the A350.
As Reuters reports, judge David Waksman refused Qatar Airways’ bid to split the court case into two parts to get a thorough understanding of the A350 issues. Airbus stated that it has already done a deeper analysis of the problem, which it says is fully understood. Instead, Waksman urged the two parties to enter a period of reflection while at the same time scheduling an expedited trial for June 2023, which is expected to take some three months.
Qatar Airways is happy with the timeline set out by the High Court. In a media statement, the carrier says: “We entered into this process to secure an expedited trial and early disclosure from Airbus that will give us an insight into the true nature of surface degradation affecting the A350s. We are extremely pleased to have secured these in today’s judgment. We will finally be able to assess the cause of the damage to our aircraft and the expedited trial will provide a swift resolution of this unprecedented dispute.”
But the court dismissed other bids from Qatar, notably an order to stop Airbus from trying to deliver more A350 to the airline and stop it from attempting to re-sell aircraft to other customers for the duration of the legal dispute. The court ruling means that Airbus is allowed to trigger payment clauses with Qatar Airways for aircraft that are built for but not accepted by the airline. The OEM is also free to sell these aircraft to other customers. Earlier, Qatar Airways said it was seeking financial compensation for the 23 grounded A350s, which stood at $980 million by the end of April but has now hit $1.0 billion.
According to Reuters, the expedited trial in June 2023 will also look again at the contract for fifty A321neo’s that Airbus unilaterally terminated in January. The court said on April 26 that Airbus had been entitled to do this and exercise its right “pursuant to a cross-default provision.” The airframer would also be free to offer the production slots to other customers. At the moment, the consequences of delaying a final ruling on the A321neo contract until June next year aren’t clear.
It seems unlikely that Qatar Airways would be willing to wait another year before it can make a final decision on the renewal and expansion of its medium-haul fleet, especially after the carrier stated in court earlier that it urgently needs the A321neo’s for the expansion of its network to Europe. The only options to get this extra capacity for Qatar would be to lease the neo’s elsewhere or confirm its Memorandum of Understanding with Boeing for 25 MAX 10s plus 25 options.
Qatar Airways vs. Airbus will be an interesting case to watch, and AirInsight will cover future developments as they occur.
(Additional reporting by Ernie Arvai)
