Fight for Asia's Skies Goes On

Reports indicate that both Boeing and Airbus are securing new orders.
Author:
Publish date:

With reports emerging that the world's two biggest planemakers are securing new orders in Asia, the competition between longtime rivals

Airbus

and

Boeing

(BA) - Get Report

shows no sign of slowing.

According to

Bloomberg

, Boeing will receive a China order for 150 of its 737 aircraft that's valued at about $9 billion. A Boeing spokesman declined to comment.

Meanwhile, the

Shanghai Times

said Airbus will get an order from Mumbai-based Kingfisher Airlines for 30 planes, a deal that's worth about $2 billion and that will be announced at the Dubai Air Show. A spokeswoman for Airbus also declined to comment.

Laurence Barron, chief executive of Airbus' China unit, said the company will deliver 65 aircraft to China in 2005 and plans to deliver 78 aircraft in 2006. Airbus has delivered 44 planes there so far this year.

"They go where the growth rates are, and right now that's China and India," said Richard Aboulafia, vice president of the consulting firm Teal Group. "But this is a global battle. You can't slack off anywhere. You have to have a global presence when you're neck-and-neck."

Aboulafia said Boeing's 787 Dreamliner is paying huge dividends for the company because it's a smaller, longer-range aircraft. The plane is appealing to China, he said, because of its ability to bypass other countries' airports. In August, Boeing confirmed reports that it would sell more than $7 billion worth of 787s to Chinese airlines.

Robert Mann, president of R.W. Mann & Company, said the need for aircraft in Asia ranges from short-haul planes up to the largest aircraft. Mann said there are concerns that growth in the Asian markets has been too rapid and that the infrastructure may not be able to support the equipment.

"I think Boeing and Airbus share the market, and neither will have a commanding lead in either market," Mann said. "It's a seesaw, and like any seesaw it comes up and down. It will be a protracted battle. Both companies have some pretty spectacular technology that's ready to come to market."