After Boeing updated its 787 schedule, several client airlines reacted strongly

–namely Air New Zealand, Air India, British Airways and launch carrier All Nippon Airways, all loyal Boeing customers-, urging the plane maker to deliver a detailed and final schedule as soon as possible. Some, notably British Airways and Qantas Airways, said they would claim for compensation. La Tribune highlights the possible impacts of the 787 delays on airlines: They will fail to meet their fuel-saving targets on time; and they might need to lease aircraft to ensure their growth in the meantime. Japanese airlines ANA and JAL, for their part, face uncertainties regarding the fate of the mid-range 787 variant. Virgin Atlantic said it was disappointed, but reiterated confidence in the 787 programme and “the aircraft’s ability to change the dynamics of the aviation industry”. Boeing is now expected to sell its 787, and possibly other models, at very attractive prices, as Airbus did with its A380.

The US government yesterday lifted barriers to the possible creation of a giant joint venture

including Air France, KLM, Delta and Northwest. The Department of Transport (DoT) proposed to grant anti-trust immunity to the alliance partners, as well as to Czech Airlines and Alitalia, also members of Skyteam. A final decision should be taken within the next two weeks. Then, Washington should give the four partners up to 18 months to set up a commercial partnership. This is good news for Air France-KLM, notes La Tribune, as the airline would thus dominate transatlantic air transport, far ahead of British Airways. La Tribune

Irish airline Aer Lingus said its shareholders had approved an order for 12 Airbus

long-haul aircraft first announced in November. The deal involves six A330-300s and six A350-900s, with an option for six additional A350-900s. The aircraft are to be delivered between 2009 and 2016. The carrier said it had negotiated “significant discounts” from the list price of $ 2.4Bn. Following a partnership agreement with US-based United Airlines and JetBlue last February, Aer Lingus relies on these new planes to support its expansion plans, notably in the transatlantic travel segment. Reuters (10/04), Bloomberg (10/04), Dow Jones Newswires (10/04)

American Airlines was forced to ground its fleet of 300 ageing MD-80 short-haul planes

used on domestic routes across the US. This move led to “chaos” at US airports, reports Financial Times. Above all, this safety check programme follows similar grounding actions at leading US airlines, including Southwest Airlines, Delta and United Airlines. Les Echos points out that, after years of huge losses, the US carriers finally returned to profit last year. Yet, this achievement was possible thanks to drastic cost-saving measures and a freeze of aircraft purchasing plans. This strategy has now reached its limits, says the French newspaper, as US airlines’ ageing fleets are leading to higher fuel and maintenance costs, and facing tighter FAA regulation. Les Echos, Frankfurter Allgemeine Zeitung, Financial Times

Ahead of an expected fleet retirement wave from 2016, Airbus has outlined its strategy

for managing “end-of-life” aircraft. The plane maker has calculated that about one-quarter of the 6,000 aircraft to retire over the next 20 years will be Airbus models. In this context, Airbus has started talks with potential partners to set up a network of aircraft recycling centres worldwide, reports Flight International. The group has just completed the first stage of an initiative called Pamela, aimed at formulating best practices for “smart dismantling”. Olivier Malavallon, Pamela project manager within Airbus’s environmental affairs department, points out that “until now, this was not a core business of Airbus”, but the plane maker wants to “be ready” for the first peak of retirements.

Eurocopter won eight firm orders during the Fidae air show in Chile.

Argentine groups STA and Vuelos Exclusivos ordered two EC120B Colibri models, Chilean airline Aero Servi ordered one EC130, and another unit was sold to Air Corporate of Argentina. Suma Air (Chile) ordered two AS350B3 units, and Helicopteros Marinos (Argentina) acquired two EC145s. Air & Cosmos

The weak dollar weighs heavily on the French aerospace industry.

In the face of eroding margins, a loss of competitiveness to their US rivals and shrinking R&D financing capacities, most industrial groups see relocation to the dollar area or low-cost countries as the only solution. Daher, Zodiac, Latecoere, Safran, as well as Airbus, have all set plans to relocate production to such countries as Mexico, North Africa, China, India or the US. Oddo Securities analyst Yan Derocles says this trend actually started “three to four years ago, accelerates today and will keep on going”. As for SMEs, most of which cannot afford to move abroad, consolidation seems to be the only alternative. La Tribune

Boeing has won a $ 2.03Bn order for 30 B737s from an unnamed buyer.

Scott Carson, head of the Boeing Commercial Airplanes division, said this week that the 737 model was likely to be the plane maker’s “product of the year” as airlines seek to renew their ageing fleets. Bloomberg (10/04)

The delays to key aircraft programmes, such as the Airbus A380 and Boeing 787,

show the limits of component outsourcing and the technological complexity of new projects. Spanish daily Expansion recalls that Airbus delivered its first A380 with an 18- month delay, while the A400M military aircraft is running months behind schedule and the Boeing 787 has just postponed its schedule for the third time. These projects are all brandnew aircraft, not updated versions of older models, which makes their development more complex. Besides, in Boeing’s case, experts point at the risks of outsourcing a massive part of aircraft-component production. Airbus has more experience in extended supply chains as the group itself was born from the merger of several national industries (France, Germany, UK, Spain).

La Lettre A points out that the AMF report, revealed by the Mediapart website,

has raised questions among analysts over the A350 XWB programme. Grievances about financial communication and possible insider trading related to the A380 are well detailed in the AMF report, but allegations related to delays to the A350 XWB have surprised several financial analysts. For long, indeed, most observers did not believe in the necessity to develop a rival to the Boeing 787, and even supported the idea of EADS dropping the project altogether. The actual revelation in the media, on May 11, 2006, that EADS could abandon the project led to a slight 1.49 % fall of the group’s share. On May 16, the company confirmed that it was redesigning the project from scratch, which led to a 5.59 % decrease.

EADS has begun a sharp counteroffensive against allegations by the AMF

of insider trading among top management at the company and its subsidiary Airbus. The press goes back over interviews granted by Louis Gallois to Les Echos and Frankfurter Allgemeine Zeitung, in which he strongly defends the members of the executive committees of Airbus and EADS cited in the inquiry, saying they are “not cheaters and profiteers”. In a note sent to the AMF’s general council, dated March 21, Mr Gallois had previously suggested that the regulator did not understand the intricacy of the aircraft business and the “industrial reality of some of the most complex development programmes”. L’Agefi, Borsen-Zeitung, Die Welt, Cinco Dias, International Herald Tribune