With airlines always looking for the latest technology to attract customers and improve fuel efficiency, the rivalry between Airbus Group (NASDAQOTH:EADSY) and Boeing (NYSE:BA) continues as a premier tech competition.
Boeing grabbed the spotlight with the launch of its 787 Dreamliner but Airbus is now ready to strike back with the A350 and its iterations aimed at the Boeing 777 and 787.
Prior to delivery, Airbus had to prove that the A350 was up for the challenge of long distance flight. To do this, Airbus sent the A350 on a three week tour of 14 cities around the world with the plane returning home to Toulouse, France, several days ago.
With the tour portion complete, Airbus can now gear up for the first deliveries of its latest aircraft.
Customers and deliveries
Airbus currently has 742 orders for the A350 and expects to begin deliveries by the end of this year. As a major customer for the aircraft, Qatar Airways will be the launch customer with plans to eventually take delivery of 80 Airbus A350 aircraft.
Despite Qatar Airways' CEO slamming both Airbus and Boeing at the Farnborough Air Show over quality and delays, the delivery of the A350 aircraft is expected to go ahead as planned over the course of several years.
Qatar Airways is not the only airline excited about the A350. Finnair, the first European airline receiving the A350, is also preparing to welcome the Airbus A350 into its fleet for both passenger comfort and range flexibility. One of the selling points of the A350 has been its range of over 14,000 kilometers allowing airlines to fly long distance routes and be competitive with the Boeing 777. For Finnair, range does matter since its Asian routes could soon be lengthened if Russia follows through with its threat to close Siberian skies to European aircraft.
Not surprisingly, the first routes Finnair plans to use the A350 for are flights to Beijing, Bangkok, and Shanghai, with flights to Hong Kong and Singapore to begin in 2016. USA Today notes that Finnair has unveiled the interiors of its A350 aircraft which feature lie-flat business class seats, Economy Comfort seats, and standard economy seats; a fairly standard arrangement on today's long distance aircraft.
Among the goals Airbus has for the A350 is for it to avoid the delays seen at Boeing in the development of its 787 Dreamliner. Although the A350 has seen about a year and a half of delays, it still expects to have fewer delays than the rival 787. With the tour test successfully completed, Airbus is one step closer to meeting the goal of delivering the first A350 by the end of the year.
Earlier this year, the A350 was also in the news but for an event that shook Airbus and sent its stock lower. The Emirates cancellation of an order for 70 Airbus A350 aircraft made investors question the quality of aircraft orders at Airbus and to some extent at Boeing as well.
Both the delays and cancellations issues are still worth monitoring but are likely to play less of a role once Airbus can begin deliveries and the A350 moves from a technical development challenge to a production based one.
Bloomberg notes that Airbus is targeting profitability for the A350 program before the end of the decade. To do this, Airbus plans to increase production to fill the orders it already has. Among the ways Airbus hopes to increase production is through the use of faster carbon component manufacturing; something that could go a long way in an aircraft comprised 53% of composite material.
Nearing a milestone
It's been seven years since Airbus last delivered an all new passenger jet but the company appears to be within months of delivering its first A350 to Qatar Airways and then to Finnair the following year.
But the challenges are not over yet. The deliveries still need to begin and production needs to be increased to fill orders at a faster rate. However, one thing is certain: This is definitely something for aerospace followers and investors to keep an eye on as the competition between Boeing and Airbus continues.
Alexander MacLennan has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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