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EuroWire – May 2007
58
Transat lant ic Cable
Airbus and Boeing
American delivery giant UPS
walks away from a big Airbus order
United Parcel Service, the largest package delivery company in
the world and the last remaining customer for the cargo version
of the Airbus A380 superjumbo jet, said on 2
nd
March that it was
cancelling its order for 10 of the planes. UPS (Sandy Springs,
Georgia) cited concerns that Airbus would not be able to meet a
revised schedule calling for delivery in 2012.
The cancellation of the $2.8 billion order is the latest blow
to the European plane maker, which had just announced the
details of a cost-cutting plan expected to result in the loss of
10,000 jobs over four years.
Only months earlier, the international courier service FedEx
(Memphis, Tennessee) also abandoned an order for 10 of the big
freighters, leaving Airbus without a customer for the A380. The
pull-out by UPS – described by a company spokesman as a final
decision – followed confirmation by Airbus on 26
th
February that
it had halted work on the A380 to concentrate on the passenger
version of the plane, now two years behind schedule.
While a formal presentation of its intention to withdraw will be
made later, UPS said it understands that either party to the deal
has the right to cancel the order.
Between them, Airbus (Toulouse, France) and Chicago-based
Boeing account for virtually the entire global jet airliner business.
Although Boeing declined to say whether it was in talks for the
UPS contract, Chris Lozier, an analyst for the investment research
firm Morningstar, told the
Chicago Tribune
(3
rd
March) that the
cancellation is a ‘crippling blow’ for the entire Airbus cargo
programme and a boon for Boeing.
“It almost spells the demise of that cargo business, because
the alternative to the 380 is the [Boeing] 747,” Mr Lozier said.
“You would expect UPS to be at the negotiating table with
Boeing right now, if not weeks ago, working out details for
the 747.”
Déjà vu for Boeing:
an Air Force contract is challenged
Even as Boeing Co seemed poised to benefit from the United
Parcel Service repudiation of a big contract with Airbus
(see above), Boeing faced similar troubles of its own.