Shares of European aerospace firm EADS have dramatically nosedived, falling 26%, after its Airbus division said there would be further delays in deliveries of the new A380 super-jumbo.
Singapore Airlines, which had been promised delivery of Airbus’ first two A380s by the end of this year, has now been told it will only get one in that time. It is seeking compensation from Airbus.
Emirates, the largest customer for the plane having ordered 45 of them, said it is “considering its position’‘ and will also want compensation. However Airbus said no airlines have yet cancelled orders because of the delays.
So far the company has 159 firm orders for the superjumbo from a total of 16 airlines. The list price for each plane is around 250 million euros. To recoup the 12 billion euros development costs, Airbus has to sell up to 300. Because of the delays the company is predicting its earnings next year will be two billion euros less than previously forecast. The late deliveries are being blamed on changes that are needed in the plane’s wiring harnesses, which control everything from basic aircraft systems to the in-flight entertainment screens. And Airbus suffered another blow when Singapore Airlines announced it has just placed an order for twenty Boeing 787 Dreamliners rather than its A350.