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Andrew Ong

SQ is considering on cancelling the A380 orders

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SINGAPORE Airlines, one of the launch customers for the Airbus A380 superjumbo, is considering cancelling part of its 19 aircraft order worth $5.2bn (£2.6bn, E3.9bn).

 

It would be the first passenger airline to cancel planes and be a significant blow to troubled Airbus after FedEx’s recent withdrawal of an order for 10 cargo aircraft.

 

Singapore’s “tolerance for delays” has “reached the limit”, according to those close to the situation. It has privately warned Airbus that further delay would force it to make further contingency plans, which would include altering the size of its order.

 

At a meeting of chief executives of airlines in the Star Alliance partnership in Istanbul last weekend, Singapore Airlines’ chief executive Chew Choon Seng, told The Business: “It is within our contract to cancel. We could make an additional order of Boeing 777-300ERs, which are a good alternative to the A380, but these would not come until 2009-10. So, much depends on whether the A380 is delayed further.

 

“We sent a technical audit team to Toulouse over the summer and the conclusion is that the technical quality is not in question; the problems are in co-ordination and sequencing.”

 

Chew is desperate for the extra capacity the A380 delivers – US rival Boeing’s 777-300ER carries 150 fewer passengers than the Airbus. But a source familiar with the situation said: “There comes a point where, if you can’t build it and deliver it, then [even though] the technical capability may be brilliant, it is just no good to anyone.”

 

Singapore is due to take delivery of its first A380 next October, 18 months behind schedule. Because of this delay it has been forced to order 19 Boeing 777-300ERs and is seeking compensation from Airbus.

 

Airbus also missed out on an order from Air China because of the delays. Li Jiaxiang, its president, said: “If there had been no problems with the A380 and the price was reasonable then maybe we would have [ordered].

 

“We are expanding our fleet by 25% a year. We are interested in both the A380 and Boeing’s Dreamliner but want to wait and see what happens until after launch.”

 

 

Not a good year for Airbus :blink:

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Aduy,

 

It would, indeed, be a big blow if such a prestigeous airline like SQ would cancel (part of) the A380 order :o

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Aduy,

 

It would, indeed, be a big blow if such a prestigeous airline like SQ would cancel (part of) the A380 order :o

 

Not only due to the cancellation, but the ordering of 773ER. Airbus will be blown away if that materializes...

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Not only A380 problems led SQ to 77W, but this will alter SQ decision on A350, guess what, I will not surprise if they cancel their A350/A330 soon. Another thing, SQ will not cancel the A380, look how much commitment they put into this beast, plus they need it. Unless if they change it to 748i or order more 77W......If SQ do cancel this, what happen to Singapore-France-SQ-Airbus relationship? Well, like my dad say,bizness s bizness, end of story.

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Yea, if the delay continues, Airbus is so gonna be AirBUST. If SG Airline pulls out... its oredi a multi million or even billion dollar lost. Wait till every other airline starts pulling out later and they are so gone case. They better buckle up and sequence their things properly. Else, I see airbus going down the drain. If not for the A32X series, I think it would have been disastrous for the company by now.

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Maybe it another gimmic that SQ is doing PR or some how play some gamble on the delivery of the A380 and the compensation of the late delivery. WHAT A GOOD PRESURE!

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Well the above news are pure rumour as SIA has just annouced on today to firm up the order for 9 A380 + 6 options.

 

 

Singapore Airlines to buy another 9 Airbus A380s

 

The Associated Press

Wednesday, December 20, 2006

 

SINGAPORE

 

Singapore Airlines said Wednesday it will buy another nine Airbus A380s, with an option for a further six of the superjumbos.

 

The carrier is also planning to lease 19 Airbus A330s and its regional airline, Silk Air, is ordering 20 Airbus A320s, the airline announced at a press conference.

 

Singapore Airlines already has 10 A380s on firm order — a deal reached in 2001 — and is expecting delivery of its much-delayed first in the fourth quarter of 2007.

 

"We are very pleased today to reach agreement with Airbus for a second tranche of A380s. We are looking forward now to delivery in October and commencing services very soon after," said Singapore Airlines Chief Executive Chew Choon Seng.

 

The order of up to 20 Airbus A320s for Silk Air has a list value of US$1.33 billion and the aircraft are to be delivered between 2009 and 2012.

 

Eleven of the A320s are on firm order and nine are on option.

 

Singapore Airlines will be the first carrier to fly paying passengers aboard the A380, the world's largest passenger jet.

 

But the October delivery is a year later than originally planned. Subsequent deliveries have suffered longer delays, averaging two years.

 

Singapore Airlines has said the Toulouse, France-based aircraft maker would provide compensation for the delays but that the terms of the settlement were confidential.

 

Airbus and parent company European Aeronautic Defence and Space Co. have blamed wiring problems for delays that are set to wipe 4.8 billion euros ($6.3 billion) off EADS profits over the next four years and complicate plans for the mid-size A350 jet, meant to compete with Boeing Co.'s upcoming 787.

 

Airbus Chief Executive and President Louis Gallios told a press conference he expects more "good news" about orders from existing customers of the A380

Edited by Seng Lim

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+ 20 orders for the A320 for Silkair :yahoo:

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Yes, besides that, 19 A330 on special lease agreement also being confirmed at the sametime and the 20+20 A350XWB will be confirm by end of the next month.

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the 20+20 A350XWB will be confirm by end of the next month.

Next month? Expect it to be 06' order so Airbus can catch up with Boeing ;)

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Maybe it another gimmic that SQ is doing PR or some how play some gamble on the delivery of the A380 and the compensation of the late delivery. WHAT A GOOD PRESURE!

 

Yup, simple negotiation tactic to push for further discounts and cheaper loaners (A330), etc. for future orders.

 

MH should learn to play the same game.

 

 

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I've used MI frequently for trips to India, and have been on the A319 to COK, iirc.

 

December 21, 2006 14:55 PM

 

Silkair Signs Contract For Additional 11 A320 Aircraft

 

KUALA LUMPUR, Dec 21 (Bernama) -- SilkAir, the regional wing of Singapore Airlines, has signed a contract with Airbus for an additional 11 A320 aircraft, plus nine further options.

 

The new A320s will be deployed on the airline's steadily expanding route network across Asia, which currently extends to 26 destinations in 10 countries, Airbus said in a statement here today.

 

The airline currently operates an all Airbus fleet of five A319s and eight A320s, with two additional A320 family aircraft from an order in 2002 still to join the fleet.

 

The A320 family's optimised cabin cross-section -- the widest single-aisle fuselage on the market -- sets new standards for passenger cabin flexibility in this segment, according to Airbus.

 

"It also allows for top-of-the-range comfort with wi

der seats and aisles," the company said.

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See posts #13 and #15 ;)

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Even Qantas was able to order some extra A380's :good: :pardon:

 

Qantas Orders Eight More Airbus A380s

 

December 21, 2006

Australian airline Qantas ordered eight more A380 super jumbo planes from Airbus, taking its total order for the 550 seat plane to 20, Airbus said on Thursday.

 

It follows a decision by Singapore Airlines on Wednesday to order nine additional A380s.

 

Qantas also ordered an extra four Airbus A330-200 jets.

 

On the basis of list prices, the A380 order represents over USD$2.4 billion and the A330-200s some USD$550 million but Airbus has been offering to supply additional A380 planes at a discount instead of paying penalties for delays.

 

"The A380 is clearly the most suitable aircraft for Qantas to meet passenger traffic growth on our dense long haul routes," Qantas chief executive Geoff Dixon was quoted as saying at a signing ceremony in Sydney.

 

"The aircraft will play a key role in alleviating airport congestion without losing capacity," he added.

 

Qantas was one of the first airlines to commit to the A380 in 2000, placing an original order for 12 aircraft, first deliveries of which will commence in August 2008.

 

"A repeat order from a premier carrier like Qantas is more than a vote of confidence in the A380," Airbus president and chief executive officer Louis Gallois said.

 

Thai Airways said on Wednesday that it was considering whether to order more planes as part of any deal to compensate for delayed delivery of six A380s.

 

The airline has said it would cancel its orders if talks on compensation failed.

 

US parcel service FedEx cancelled an order for 10 of the freighter version of the A380 last month, switching to Boeing's 777.

 

Airbus has sold a total of 158 A380s.

 

As the year-end looms, Airbus is at risk of losing its annual battle with Boeing for the most orders for the first time since 2000.

 

Boeing had booked 865 orders as of December 12 versus 635 as of November 30 for Airbus, their web sites showed.

 

(Reuters)

 

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Hi there,

 

Just found & join this forum. But all I can say is SQ has been using this tactics (make public press abt cancelling order) to secure cheaper price for next order. SQ are not really affected by the the delay since B744 still around to cover the capacity. Also SQ got hefty compensation for delay & big discount on new planes. B777-300ER is not meant for B744 replacement as their seat capacity is much lower than current 777-300. So the idea of cancelling A380 for 777-300ER won't work.

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