Airbus in Talks to Delay Some A320neo Deliveries, Report Says

February 5, 2016, 3:39 PM UTC
Airbus Group NV's Airbus A320 Neo Aircraft Makes Debut Flight
A part-painted British Airways Airbus A380 aircraft, manufactured by Airbus Group NV, takes off from Toulouse-Blagnac airport in Toulouse, France, on Thursday, Sept. 25, 2014. The Toulouse, France-based manufacturer's long-term forecast predicts demand for almost 9,300 wide-body planes worth $2.5 trillion -- 1,500 of those in the 400-seat-plus bracket occupied by the A380 -- and more than 22,000 single-aisle planes valued at $2.1 trillion in the market dominated by the A320 and Chicago-based Boeing's 737. Photographer: Balint Porneczi/Bloomberg via Getty Images
Photograph by Balint Porneczi/Bloomberg/Getty Images

Airbus (EADSY) is renegotiating delivery schedules for its revamped A320neo jet and has told some airlines it will be delayed by about two months, industry sources told Reuters.

The European planemaker missed a 2015 target for delivering the first aircraft, an upgraded fuel-saving version of its best-selling medium-haul jet, by a few weeks due to what it described as issues with documentation for new Pratt & Whitney engines.

Industry sources have pointed to delays in deliveries of the newly-developed Geared Turbofan engine from its U.S. manufacturer, a subsidiary of United Technologies (UTX).

There was no immediate word on the number of aircraft affected or the full range of expected delays.

Airbus and Pratt & Whitney confirmed they were in talks over deliveries, without elaborating.

“We are in talks with our customers on deliveries and once these talks will have concluded, then we’ll finalize the aircraft and deliver to our customers as agreed,” an Airbus spokeswoman said.

“We are in talks with our operator customers on delivery schedules and once these are concluded we will finalize the schedules as agreed,” said a spokeswoman for Pratt & Whitney.

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Although the delays are minimal compared with some all-new programs, the A320 and Boeing’s (BA) competing 737 drive a large chunk of aerospace industry profits and are closely watched.

Airbus has said deliveries of the A320neo will be tilted towards the second half of the year.

The A320neo is designed to save 15 percent in fuel consumption. So far, Airbus has delivered one aircraft to Germany’s Lufthansa.

The launch customer was originally supposed to be Qatar Airways but it rejected early aircraft due to longer than expected startup times, requiring extra fuel.

Speculation about last-minute fine-tuning resurfaced after the first aircraft was delivered after an unusually extensive series of 11 pre-delivery test flights, according to data from website Hamburg Finkenwerder News.

In December, India’s IndiGo said it would not receive its first A320neo on time for “industrial reasons” and warned of further delays.

United Technologies said last month the engines needed “a software fix and a minor hardware fix” to deal with cooling problems, but were meeting performance targets.

The A320neo is sold with engines from either Pratt & Whitney or CFM International, owned by France’s Safran and General Electric. CFM also powers the competing Boeing 737 family, including the revamped 737 MAX.

The first CFM-powered A320neo is expected to be delivered in July.

Boeing said on Wednesday it was working to deliver the 737 MAX ahead of schedule. The Wall Street Journal reported it could be delivered up to six months before the third-quarter 2017 target.

(By Tim Hepher; Editing by James Regan and David Clarke)

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