The annual Airbus investors days are tomorrow and Thursday in London. Airbus will webcast the event; go here to link up.
The presentations will include a mix of commercial and military, with John Leahy, chief operating officer of customers, presumably presenting on the commercial. Group CEO Tom Enders, along with the chief financial officer, are likely also to present; the agenda won’t be posted until tomorrow.
On the commercial side, we expect discussion of the pending delivery Saturday of the A350-900 to launch customer Qatar Airways. Entry into service won’t happen until next month.
We expect the analysts to drill down on the A330ceo production gap; Airbus has had little success selling this airplane, and the hoped-for large order from China for the A330R has once again failed to materialize. The gap falls off the cliff in 2016. Airbus previously announced a production rate cut from 10 to nine in 4Q2015 but we think this will have to drop even more, and dramatically.
We also expect questions, which almost certainly will be answered ambiguously, about the pricing of the A330neo and A350-900 order from Delta Air Lines. Delta’s CEO publicly said he’d be happy to order the neo if the price was between $70m-$80. Now that the order happened, the question is obvious: was the price in that range? We don’t expect Airbus to reveal pricing for the obvious commercially sensitive reasons between Airbus and DL, and at the same time, Airbus doesn’t want other airlines to be using this range as a benchmark.
Questions might also arise about where Airbus got the delivery slots to accommodate Delta’s early schedule requirement. These customers were scheduled to take delivery in 2017: China Aviation Supplies, Air Lease Corp and AerCap, each with unplaced airplanes as of July when we last pulled information, Asiana, Avianca, AWAS, also with unplaced airplanes, Azul (via AerCap), Cathay Pacific Airways, China Airlines, Ethiopian Airlines, Finnair, Lufthansa, Qatar, Singapore, Sri Lankan, TAM, TAP, Thai, US Airways and Vietnam. Many of the same companies have deliveries scheduled in 2018. Hawaiian Airlines was set to receive A350-800s, but this order was ditched in favor of the A330-800. Unknown is if these slots had already been reallocated.
Airbus and Boeing had scoured the market to find slots for Delta; Airbus succeeded and Boeing didn’t. Not only does the question arise, who did Airbus get the slots from but also what incentives were required for the customer(s) to give up the slots?
Leahy told The Wall Street Journal he expects an A321neoLR order by year end—the obvious question: from whom? CIT Aerospace yesterday publicly expressed interest. American Airlines has acknowledged interest but says it’s not yet ready. United Airlines, Delta and jetBlue have also seen some details but we don’t think they’re quite ready. Air Lease Corp has been a strong, public advocate for a Boeing 757 replacement. We expect questions on this topic.
The prospect of an A380neo is likely to arise again. We expect the answer to be, “we’re studying it.” A decision is believed coming next year (we think it will be a “go.”)
The military A400M will likely come up and perhaps the KC-330 MRTT. We don’t follow other military programs.
Guidance for 2015 orders and deliveries will likely be provided.