Qantas cancels order for 8 Airbus A380s amid doubts on jet’s future

Qantas flight QF1, an Airbus A380-800 aircraft, takes off from Sydney International Airport above Botany Bay in Australia. (REUTERS File Photo)
Updated 07 February 2019
0

Qantas cancels order for 8 Airbus A380s amid doubts on jet’s future

  • Qantas to still refurbish 12 A380s in its existing fleet
  • Dubai’s Emirates is exploring switching some orders for the superjumbo to the smaller A350
* Order was placed in 2006, not part of fleet plan for “some time“
* Comes amid doubts over future of superjumbo
* Qantas to still refurbish 12 A380s in its existing fleet (Adds context on A380 future, Airbus comment)
By Jamie Freed
SINGAPORE, Feb 7 : Australia’s Qantas Airways Ltd. said on Thursday it formally canceled a longstanding order for eight Airbus SE A380 superjumbo jets.
The decision, which will remove the order placed in 2006 from the Airbus order book, comes as new doubts have been raised about the future of the four-engined A380.
Dubai’s Emirates is exploring switching some orders for the superjumbo to the smaller A350 in a move that has Airbus looking closely at closing A380 factories sooner than expected, people familiar with the matter told Reuters last week.
A Qantas spokesman said the airline had formalized its decision to cancel the order for eight A380s following discussions with Airbus.
“These aircraft have not been part of the airline’s fleet and network plans for some time,” the Qantas spokesman said.
Qantas has 12 A380s in its fleet and the spokesman said it would proceed with plans to refurbish the cabins starting in the middle of this year, with the jets set to remain flying with the airline “well into the future.”
An Airbus spokesman said the manufacturer had agreed to the “contract amendment” announced by Qantas.
“This change will be reflected in our end January order and delivery tables,” the Airbus spokesman said.
The Qantas spokesman declined to comment on the terms of the cancelation.
It comes after another order long viewed as doubtful for 10 A380s from Hong Kong Airlines was removed last month from the end-December Airbus order and delivery tables following negotiations.
Willie Walsh, the CEO of British Airways parent IAG , said last week that Airbus should lower the price of the A380 if it wanted to sell more of them.
The A380 has a list price of $445.6 million, but airlines typically receive significant discounts from manufacturers.


Russian arrests of foreign businessmen shocks Western investors

Updated 1 min 23 sec ago
0

Russian arrests of foreign businessmen shocks Western investors

  • Baring Vostok's executives were arrested in a case brought with the help of the FSB security service
  • It is just the latest in a long line of cases in which top business people have been accused of crimes motivated by commercial or political interests
MOSCOW: The arrest in Russia of prominent US and French investors on suspicion of fraud has sent shockwaves through Western business circles and sparked fears of cutbacks in foreign investment sorely needed for economic growth.
The founder and employees of the Baring Vostok private equity firm were arrested on Friday in a case brought with the help of the FSB security service.
The arrest took place on the same day Russia hosted leading business people in the Black Sea resort of Sochi for a major economic forum which trumpeted the country’s openness to investment.
Michael Calvey, a US citizen and the founder and director of Baring Vostok, has been placed in pre-trial detention in a Moscow jail for the next two months for alleged fraud, along with five others — including Philippe Delpal, a French citizen.
They are accused of defrauding Vostochny Bank of at least 2.5 billion rubles ($37.7 million). All of them deny any wrongdoing and blame the case on a shareholder dispute.
In an opinion piece on Monday in the Vedomosti business daily, Maxim Bouev — vice-rector of Moscow’s New Economic School — wrote the case proves what investors have long known: “If you want to invest in Russia, you have to accept your risk of eventually being arrested and finding yourself in the dock.”
This is the latest in a long line of cases in which top business people have been accused of crimes motivated by commercial or political interests, but these have rarely involved foreigners.
Business figures and economists reacted strongly to investigators swooping on Baring Vostok, founded 25 years ago, which has brought in investments of more than $3 billion to Russia despite the geopolitical tensions and Western sanctions of recent years.
Arkady Volozh, the CEO of Russian Internet giant Yandex, defended Calvey in a statement, saying he “has always been a standard for the market of decency and law-abidingness.”
Other business leaders said they fear the case will deal a severe blow to an investment climate already marred by corruption and the lack of independent courts — especially given the strong-arm tactics employed.
“This gives Russia a hateful image abroad,” the president of the French-Russian chamber of commerce, Emmanuel Quidet, told AFP.
The chamber on Monday said it was “very concerned” about the arrests in a joint statement with the Association of European Businesses, a federation of multinational companies working in Russia.
The case could “severely damage the climate and attractiveness of Russia for direct investments from abroad,” it said.
The Kremlin sought to dispel those fears, with spokesman Dmitry Peskov saying Calvey’s arrest should “not affect the investment climate” in Russia.
He added he was aware of the contribution to the Russian economy made by Calvey, who has met President Vladimir Putin numerous times.
The government in early February unveiled a 340 billion euros ($385 billion) plan to achieve its economic goals and support growth that is forecast to slow this year. This will require major private investment.
“It’s an electric shock,” a source in the Association of European Businesses told AFP.
“You get the impression that business rivals are using the justice system and Russian (security) services to settle their scores. But the fact that the authorities are letting this happen sends out a very negative signal. You wonder who will be next.”
In the Novaya Gazeta independent newspaper, outspoken commentator Yulia Latynina claimed that in the context of current East-West tensions, “for security officials, business people are criminals and foreigners are spies.”
bur-apo-am/boc/fox