Watch for Airbus A380 Work in Japan -- Just In Time for the Airlines' Recovery

A priority for Airbus this year is to break into Boeing's fortress market in Japan, Airbus CEO Noel Forgeard said here yesterday. "This will include significant industrial participation, for the first time," he said, giving notice that Airbus and the Japanese will disclose work-sharing agreements on the A380 superjumbo in the near future.

The timing looks to be excellent. "It's encouraging to see signs of recovery, in particular here in Asia," Forgeard said. "There's clearly an improvement in loads, and some airlines are re-introducing frequencies and destinations."

Airbus chief commercial officer John Leahy compared the recovery with that of the Gulf War. "It's a similar scenario. Then, all the pundits were saying that it was different, that the airline industry wouldn't come back. But we're seeing an equally significant and quick recovery.

"First the traffic comes back, then the yields come back," Leahy said.

Airbus has reduced its 2002 production projection to 300 aircraft, compared with 400 projected prior to September 11. "That was a product of negotiations with customers, including requests for postponements," Forgeard said. "We still have a few such negotiations, but they are marginal." The company will re-assess plans for 2003 at the end of the second quarter, but expects to maintain production at about 300 units.

Leahy expects airlines to place 400 orders for aircraft of more than 100 seats in 2002, offset by some 100 cancellations and deferments. Airbus' goal remains to win half those orders.

Restructured into a single entity with direct employees, Airbus can now be compared directly with Boeing. "Boeing laid off 30% of its employees," Forgeard said. "We did not. Why? For a very simple reason. Even after the layoffs, Boeing employs 35% more people than Airbus to produce the same number of aircraft."

By Bill Sweetman