Japan Airlines Agrees to Deal with Airbus

Airbus the manufacturing giant for aircraft announced a first deal ever with Japan Airlines the Japanese carrier.

The deal just signed was for 31 A350 planes and was worth close to $9.5 billion at the prices that Airbus lists for that model aircraft.

The aircraft A350 is designed to have better fuel efficiency and to be direct competition to the 787 Dreamliner made by Airbus’ U.S. rival Boeing. The Boeing Dreamliner has run into problems of late with technical and safety issues.

The new deal between JAL and Airbus is a huge blow to Boeing, which has dominated the aviation market in Japan.

This is the largest order for the Airbus A350 thus far in 2013 and the largest ever the company has received from an airline based in Japan, said CEO of Airbus Fabrice Bregier.

As per the deal, JAL will also have an option to buy another 25 aircraft.

Over recent years, the industry had been hit by a demand slowdown and high volatility due to the prices of fuel worldwide.

Some leading air-carriers have had to turn to aircraft that is more fuel-efficient in order to try to cut down their costs and maintain their profitability.

Both Boeing and Airbus have seen surges in demand for such aircraft. Airbus, which claims the A350, uses nearly 25% less fuel than the previous generation aircraft that was wide-body. It says it had 725 orders for the A350 before it signed the deal with JAL.

The company is hoping to start its delivery of the first A350s before the end of 2014, to its customers.

Meanwhile, the 787 Dreamliner from Boeing continues to be popular despite the temporary grounding worldwide of the aircraft this year while an investigation was completed by safety regulators over fires in the aircraft.



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