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Airbus and Etihad Seal Major Deals

DUBAI — Airbus SAS announced its second order of the Dubai Airshow in as many days — a sale of A320 jetliners worth $700 million at list prices to Yemen Airways — while the UAE’s Etihad Airways disclosed a package of contracts for aircraft repairs and other services totalling $750 million.

The deals on Monday were the commercial highlights of the second day of the show, which has so far generated much less business than it did previously in 2007 when participants announced a combined $155 billion in orders. The main reason for these different outcomes has been the intervening economic crisis and consequent plunge in demand for air travel.

Airbus on Monday signed a memorandum of understanding with the Yemeni flag carrier for 10 single-aisle A320s, with delivery to begin in 2011. The European plane-maker aims to firm up the deal within 30 days, its chief salesman John Leahy told a Press conference at the show.

Yemen Airways, also known as Yemenia, is perhaps best known for the crash in June of one of its jetliners, an Airbus 
A310, in the Comoros Islands of the Indian Ocean. All but one of the 153 people on board the plane were killed.

The carrier expects to receive four of its new A320s in 2011, two in 2012 and the final four in 2013, company board member Saleh Alawaji told Khaleej Times. The new planes will be configured in a two-class configuration with seating for 12 passengers in business class and 138 in economy.

“The aircraft will be deployed to enhance and expand services on regional, African, Indian and European routes. It will enable Yemenia to demonstrate its role as a growing regional carrier and contributor to the growth of Yemen’s economy,” Alawaji said.

“The A320 shares operational and maintenance commonality with our existing Airbuses and will bring added efficiencies,” he said. Alawaji added that Yemenia is not expecting to earn a profit this year, due to the global economic slowdown. “Next year, hopefully.”

Yemenia’s fleet includes two A330-200s and three A310s. Sanaa and Aden based, Yemenia’s long haul fleet, operate to destinations in Europe, the Middle East and Asia. During the 2007 Dubai airshow, Yemenia placed an order with Airbus for ten Airbus 
A350 XWB.

“We are planning expansion in the subcontinent,” Alawaji said. “Opening of two new sectors — Cochin and Chennai — in India are under consideration at the moment.”

The airline now operates five flights a week from Yemen’s capital Sanaa to Mumbai, said Muneer Mohd Jahwash, its area manager for Dubai and 
Northern Emirates.

Alawaji told reporters that Yemenia expects to appoint a third-party investigator within the next 30 days to look into the June crash in the Comoros. “We are clarifying all the information — the data and the voice (cockpit recorders)—and looking for a third party to investigate,” he said on the sidelines of the news conference.

Etihad, for its part, plans this week to announce eight service and outsourcing deals worth a total of $750 million, the carrier’s Chief Executive Officer James Hogan told a news conference on Monday. They are to include a $250 million contract with maintenance, repair and overhaul provider SR Technics and a $200 million agreement for engine repairs with Aero Engines.

Conspicuous for its absence was any order of new aircraft. Abu Dhabi-based Etihad made waves at the Farnborough, UK, air show last year when it placed firm orders for 100 planes and took options and purchase right to an additional 105. Asked if Etihad planned to announce a purchase of any aircraft at this week’s show, Hogan replied with a firm “No.”

Hogan described last year’s mega-order as a “strategic” purchase that would keep aircraft coming up to 2017.

“We’ve got the aircraft that we believe we need to complete the mission,” he said.

· abdulbasit@khaleejtimes.com

· bruce@khaleejtimes.com