Airbus is forced to chase Boeing in the rush of the year

Airbus is trying to take the ground lost compared to its Boeing competitor, with a series of multibillion-dollar agreements to close a traumatic year haunted by management disruptions and corruption investigations.
The bids announced this week include the confirmation of a record order of 430 aircraft traded by private equity company Indigo Partners based in the United States on behalf of four airlines. But some analysts have said that Airbus may have to offer big discounts to secure the order.
The Indigo deal and another 275 last-minute orders are seen as a grand finale for Airbus chief sales officer John Leahy, who will retire in January after nearly tripling Airbus' market share in its 23 years of operation.
Airbus has endured what the insiders describe as a painful year, dropping sales sharply and forced to chase Boeing.

Leahy is interested in selling at least the 700 jets that Airbus plans to deliver in 2017, after revising the internal target that saw 400 sold earlier this year, when the industry was slowing sharply.
But many observers expect the New Yorker to go further and try to find a match in terms of sales with Boeing, which recorded 844 net orders up to December 19 and is believed to be closer to 900 by the end of the year .
Airbus has announced deals for a total of 705 narrowbody jets since late November, including more than 500 in 24 hours - an industry record, according to Jefferies analyst Sandy Morris.
The latest orders give Airbus potential to exceed the 1.000 orders.
Offers also include 100 jet for Delta Air Lines, 50 each for AerCap and China Aircraft Leasing (CALC) and 75 between two other airlines.

Hungary's Wizz Air said, however, that part of the Indigo order, comprising 146 jets, needed shareholder approval.
If all the operations announced by Airbus since the beginning of December are included in the year-end total, then two-thirds of the business year business will have been done in the past month, compared to an average of 20% which marks a record over 10 previous years.
Some analysts and industry sources have said such commercial aggression could hurt profit margins as marketing planning offers concessions to get deals across the board. The impact is not easy to assess, however, one thing is certain, higher volumes also help jet manufacturers cut costs.
"The business Indica shows that investors hold plan orders for airlines, but this is not good for profit margins as it increases the purchasing power of buyers," said Teal Group analyst Richard Aboulafia. .
Another analyst, speaking on condition of anonymity due to company rules, said that concessions should not lead to price cuts.
Airbus sources said prices were driven by the size of the agreements and denied making unusual concessions.
Both Airbus and Boeing have large enough pockets to offer discounts on best-selling narrowbody jets, where they get more profits. In fact, both parties have accused each other of having carried out heavy discounts outside the commercial market.
On the contrary, it was a poor year for Airbus wide body jet orders. With 46 orders so far, Airbus has been beaten three to one by Boeing, whose Dreamliner sales are at their best by the 2013.
Despite doubts about the future of the world's largest airliner, the A380, Airbus still hopes to secure a 36 order from Dubai's Emirates. Talks broke off at last month's Dubai Airshow but have since resumed, industry sources say.
That hasn't stopped Airbus from putting in contingency plans to phase out A380 production if the Emirates deal is abandoned, Reuters reported this week. Yet Airbus is also betting that if Emirates buys, this will be a catalyst for more sales globally.

Airbus is forced to chase Boeing in the rush of the year

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