PS says evaluating Airbus A380 orders
UPS says evaluating Airbus A380 orders
Fri Oct 20, 2006 5:19 PM ET
NEW YORK, Oct 20 (Reuters) - United Parcel Service Inc. <UPS.N>, the world's largest package delivery company, has set up a team to evaluate its multi-billion dollar purchase of Airbus A380 freighters, saying all options remain open.
The move, announced in a conference call with analysts on Thursday, and confirmed by the company on Friday, is a further sign of doubt among Airbus customers over the A380 superjumbo, which is now two years behind schedule.
On Oct. 4 Airbus -- majority owned by European aerospace group EADS <EAD.PA> -- announced a third delay to A380 production due to problems with the plane's wiring.
The announcement caused airlines around the world to review their purchase plans for what will be the world's largest commercial plane, although none has yet canceled orders.
UPS, whose freighter fleet makes it the world's eighth-largest airline, has 10 A380s on order, worth more than $2.5 billion, with an option to buy 10 more.
UPS said on Friday that it received official notification of the latest delay on Oct 6, pushing back its first A380 delivery to May 2010 from September 2009.
On Oct. 9, Bob Lekites, vice president of UPS airline and international operations, ordered a team to evaluate the order, according to a company spokesman.
"This is an open-ended evaluation that rules out nothing," UPS spokesman Norman Black said. There is no deadline for the team, made up of people from UPS's international operations, to report its conclusions, he added.
That leaves open the possibility that UPS may buy or lease Boeing Co. <BA.N> planes as a stopgap measure, or even cancel the order outright and buy Boeing planes instead.
Earlier this month Dubai's Emirates [EMAIR.UL], the top buyer of the A380 with 43 on order worth $13 billion at list prices, said it was putting its purchases on review.
Australia's Qantas Airways <QAN.AX> said on Thursday it would maintain its A380 order despite a two-year delay in receiving its first planes.
U.S. leasing firm International Lease Finance Corp. has said it is keeping its options open.
