Delta Order Affirms the Age of the Airbus A350 Is Approaching

 A photo of the Delta A350-900 has been added to this story.

NEW YORK (TheStreet) -- For years, every twist and turn in the saga of the development and introduction of the Boeing (BA) 787 Dreamliner has been carefully charted in the aviation media.

Now, the Dreamliner has a competitor for the airline industry's attention. The first Airbus A350 will be delivered next month to state-owned Qatar Airways. And Delta (DAL)  on Thursday announced an order for 25 aircraft, meaning that unlike the 787, the A350 has collected orders from all of the big three U.S. carriers.

 "The A350 is the second new generation twin-aisle aircraft to reach the market," said Richard Aboulafia, aerospace analyst with the Teal Group consulting firm. "That's going to help shift Airbus' market share back toward 50%, at least until the 777X arrives."

Must Read: Qatar Airways Will Fly First Airbus A350 Into the Heart of Europe

This was a good week for the A350. On Tuesday, Qatar CEO Akbar al-Baker was quoted by Gulf News as saying that first delivery of the aircraft will be between Dec. 12 and Dec. 15. He appeared to rule out any last-minute glitches, declaring "everything is perfect," according to the Dubai-based newspaper.

Then Delta confirmed reports that it will order not only 25 A350-900s but also 25 A330-900neos starting in 2017 and 2019, respectively.

Delta said the A350s will operate primarily on long-range routes between the U.S. and Asia, replacing Boeing 747-400s, starting in the second quarter of 2017. The aircraft has a range of 7,750 miles and is projected by Airbus to carry about 315 passengers.

The A330s will be deployed on medium-haul trans-Atlantic routes and select West Coast-Asia routes, delivering a 20% operating cost savings over the 767-300s they will replace, the carrier said. Their projected range is 6,200 miles, with a passenger load of 310 passengers.

"When the most successful U.S. airline today -- a company that has flown passengers around the world for more than 80 years, has 80,000 employees and 165 million customers in a year -- says 'yes we want 50 more of your widebody planes,' you can't debate the fact that it is a massive endorsement of your product line," said John Leahy, Airbus chief operating officer, in a prepared statement.

The order means that in Seattle, home to most Boeing commercial aviation manufacturing, Airbus jets are likely to provide the majority of the flights to Asia from Delta's growing Seattle hub.

We can just see the Alaska (ALK) ads. Last month, when it announced the purchase of 10 additional Boeing 737-900ER aircraft, Alaska proclaimed that "customers will enjoy expanded service from Alaska's Seattle hub and a commitment to a locally manufactured fleet" and President Brad Tilton declared, "We love having Seattle as our home and buying locally built airplanes is a point of pride for us."

Aboulafia said the Delta order was widely expected, given that the carrier "has been very aggressive on capital costs.

"This is the first time they bought new generation planes," he said. "They must have gotten a very good deal."

Meanwhile, Aboulafia said, Delta's order for the A330neo is an affirmation of an aircraft that some had viewed as offering little variation from the classic A330. "This is the first time a major blue chip carrier has said 'we like it,'" Aboulafia said. "Boeing has said it's a last-generation product, but this shows it is obviously a competitive product."

Must Read: Could It Be that Delta Enjoys the Contract Squabbles at American?

The order is a blow to Boeing's effort to continue to generate sales for the 777 classic while it develops the 777X, Aboulafia noted.

In Leeham News and Comment, where he was the first to report that Delta would place the Airbus order, aerospace consultant Scott Hamilton wrote that "Boeing hoped to sell Delta the 787-9 and also offered five new 777-200LRs as bridge lift until delivery slots for the 789 were available.

"Losing is a major disappointment for Boeing, not only because of the sheer number of wide-body airplanes involved but also because this is one of the big three U.S. carriers; and there was the slim chance Delta might take Boeing up on the 777LR order, which would help fill the struggling production gap for the 777 classic," Hamilton said.

As for Qatar, the carrier said last month that its first use of the A350 will be on the Doha-Frankfurt route, where it plans two daily frequencies. Qatar said it chose Frankfurt as its first destination because of the A350's "significant capacity."

That's good because Frankfurt obviously was not selected in order to take advantage of aircraft's long-range capability. Doha-Frankfurt is just 2,855 miles. "The route is underutilizing the capability of the airplane," Hamilton said.

But Qatar has aimed its aircraft squarely at Europe's most important hub. "If you're going to go fishing, go where the big fish are," said aviation consultant Bob Mann. "Qatar is not reluctant to put its best foot forward and drain the pool of revenue."

-- Written by Ted Reed in Charlotte, N.C.

To contact this writer, click here.

Follow @tedreednc



At the time of publication, the author held no positions in any of the stocks mentioned. This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.

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