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Problems at Airbus

A380 Faces New Delays

European aerospace giant EADS says it faces fresh delays on the production of its Airbus A380 superjumbo jet. It will deliver five fewer aircraft than expected in the next two years and has warned customers, including Emirates, that they may have to wait even longer for their planes.

Airbus parent company EADS says it is expecting further delays in deliveries of the A380 superjumbo, the world's largest passenger jet. In 2008, the company says it will only be able to build 12 of the aircraft instead of a planned 13. In 2009, it will only produce 21 of a planned 25 jets. The numbers for 2010 and 2011 may also be lower than projected.

EADS claims that it has already delivered four A380 aircraft, and 17 others are in production. "Most aircraft earmarked for delivery in 2008 have already flown," the company said in a statement.

The company said that details about the new plan and deliveries for 2010 and the following years will be discussed with customers in the coming weeks. Delays will be on a scale of two or three months. "This is hardly a disaster scenario," Airbus head Thomas Enders said.

EADS said its review of production at this stage does not cover the financial impact. "The extent of the additional costs will be influenced by the actual production and delivery scenarios," the company's statement added.

Last week, executives at Emirates airlines, one of the largest customers for the A380 superjumbo, said they had been informed by Airbus of expected delays in delivery. The company is already supposed to have been delivered 19 aircraft, but instead it has received close to €100 million ($154.5 million) in compensation payments from Airbus because of delays.

Airbus has been battling with production problems on the superjumbo for years now. In June 2006, the company announced an 18-month delay in delivery of the first A380. At the time, the company was struggling with complex wiring in the passenger cabin. The company's contracts with customers stipulate that it must pay damages if it fails to deliver planes on time, and so far those fees have surpassed €5 billion. The company delivered its first A380 to Singapore Airlines last October.

But the new production tangles are only the latest in a long list of recent problems at the company. Just last week, the company announced that an important part of its restructuring plan -- the sale of two French plants to Airbus supplier Latecoere -- had fallen through because the companies could not agree on the dollar value of the planned orders.

Airbus' chief operating officer, Fabrice Brégier, recently said the company is also planning to expand its so-called "Power 8" restructuring program to further stem losses -- largely by demanding longer working hours for its employees, cutting jobs and relocating production to countries outside the euro zone.

dsl/reuters/afp/dpa-afx