August 8, 2008
United Airlines may cancel an order for 42 Airbus aircraft, forfeiting a USD$91 million dollar deposit and possibly heralding a wave of deferrals and cancellations for the major plane makers as their customers scale back growth plans.
The airline, one of Airbus's best US customers, is currently committed to pay USD$2.2 billion for the purchase of 42 A319 and A320 single-aisle aircraft. If it does cancel the order, UAL would forfeit the advance deposit paid to Airbus.
It is "highly unlikely that (UAL) will take future delivery of these aircraft," UAL said in a July 24 filing with the US Securities and Exchange Commission.
The US airline industry, suffering under the weight of high fuel costs, is rapidly shrinking. United has said it would cut its fourth-quarter capacity of its main operations by up to 16.5 percent, meaning it will need fewer planes to serve its routes.
Some analysts have said Airbus and rival Boeing could lose a quarter or more of the plane orders on their books as carriers cut back growth plans in the face of high fuel costs.
Airbus has had 43 order cancellations so far this year, but some of those are accounted for by shifts to a new version of its A350 model. It said earlier this year that US low-cost carrier JetBlue Airways will defer some deliveries.
Boeing has had one cancellation this year, a 787 for Azerbaijan Airlines, and has said Southwest Airlines and AirTran have deferred some orders.
(Reuters)
United Airlines may cancel an order for 42 Airbus aircraft, forfeiting a USD$91 million dollar deposit and possibly heralding a wave of deferrals and cancellations for the major plane makers as their customers scale back growth plans.
The airline, one of Airbus's best US customers, is currently committed to pay USD$2.2 billion for the purchase of 42 A319 and A320 single-aisle aircraft. If it does cancel the order, UAL would forfeit the advance deposit paid to Airbus.
It is "highly unlikely that (UAL) will take future delivery of these aircraft," UAL said in a July 24 filing with the US Securities and Exchange Commission.
The US airline industry, suffering under the weight of high fuel costs, is rapidly shrinking. United has said it would cut its fourth-quarter capacity of its main operations by up to 16.5 percent, meaning it will need fewer planes to serve its routes.
Some analysts have said Airbus and rival Boeing could lose a quarter or more of the plane orders on their books as carriers cut back growth plans in the face of high fuel costs.
Airbus has had 43 order cancellations so far this year, but some of those are accounted for by shifts to a new version of its A350 model. It said earlier this year that US low-cost carrier JetBlue Airways will defer some deliveries.
Boeing has had one cancellation this year, a 787 for Azerbaijan Airlines, and has said Southwest Airlines and AirTran have deferred some orders.
(Reuters)