Qatar Airways May Buy More Airbus A380s

By Robert Wall, The Wall Street Journal

Qatar Airways' first A380 touched down at London Heathrow Airport on Oct. 10, 2014

Qatar Airways Chief Executive Akbar Al Baker said the carrier may buy more Airbus Group SE A380 superjumbos because of the benefit of low oil prices.
The airline had already ordered ten A380 double-deckers and may exercise an existing option for three more with oil prices at US$60 per barrel or lower, Mr. Al Baker told reporters at a travel event.

He said the A380's profitability for airlines is sensitive to oil prices. Qatar Airways about two years ago asked Airbus to delay delivery of four of its planes by about a year each when oil prices were still high. The airline has now asked Airbus to complete work on the planes so it can resume deliveries of the last four already ordered starting around the end of the year.

Though low oil prices are a boon for carriers, Mr. Al Baker also said it has weakened pricing on premium traffic.

Any deal could be a welcome boost for Airbus, which has struggled to win more orders for the A380 superjumbo. The European plane maker is trying to pad its orderbook for the plane type that is running short of orders after 2017.

Airbus recently won an order from All Nippon Airways for three A380s, while Iran Air has said it plans to take 12 of the aircraft, though that deal is not yet finalized.

A dearth of deals in recent years is adding pressure on Airbus to lower production costs of the plane that retails for more than $400 million at list price, though buyers typically get discounts. Airbus last year managed to end years of losses in building the planes, and company officials said they expect to remain at breakeven for the superjumbo this year and next.

Large four-engine planes have also been selling poorly at Boeing Co and the Chicago-based planemaker has had to cut output of its 747-8 jumbo which competes with the A380 for orders.
Mr. Al Baker also said Qatar Airways is due to receive the first A320neo single-aisle plane around mid-year. The company held off from taking the first plane last year because of shortcomings with the plane's engine, made by United Technologies Corp.'s Pratt & Whitney unit.

The delays in getting the aircraft fully compliant with Qatar Airways's requirements are starting to irk the vocal chief executive. "I have already notified Pratt that we are at the threshold of our walk away clause," he said. "We will not wait indefinitely," he said.