Sun, 21 Jul 2019

Airbus SE secured a $35bn jet deal from China during a state visit by President Xi Jinping to the French capital, dealing a fresh blow to Boeing as it grapples with the grounding of its best-selling jet.

The mammoth order comprises 290 A320-series narrow-body planes and 10 A350 wide-bodies, French President Emmanuel Macron's office said at a briefing Tuesday. The latest A320neo model has a list price of $110.6m and the A350-900 sells for $317.4m before discounts.

Boeing's 737 Max narrow-body, the chief rival to the A320, has been idled following two crashes in five months. The US planemaker is also struggling with the fallout from a China-US trade war that's seen sales to the Asian nation dry up.

A major deal for Toulouse, France-based Airbus was first touted by Macron in January 2018 during a trip to Beijing, when a figure of $18bn was put on the transaction. A firm order failed to materialise despite a second French state visit in June and a delegation of top Airbus executives in September.

The deal announced in Paris will include both Neo - for new engine option - and so-called classic or CEO versions of the A319, A320 and A321, though the majority will be A320neos and A321neos, according to officials. China typically orders planes in large batches and allocates them to airlines later.

The Asian power has become the most important market for Airbus and Boeing as its fast-growing middle class spurs demand for travel. While the US company's order prospects have been complicated by the trade clash, Airbus has bolstered its position with an offer to expand a production line in Tianjin.

The deal will provide a boost for the European company's incoming chief, Guillaume Faury, who takes over from Tom Enders in April. Airbus sales have had one of the slowest starts in the past decade, with the planemaker registering 103 cancellations and just four new orders in the first two months.

Airbus shares pared declines of as much as 1.7% earlier in the day to close 0.5% lower in Paris.

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