Airbus set for Jumbo launch

Europe's airline industry looks set to challenge
Boeing for the large aircraft market.

Airbus, which already makes more smaller jets
than Boeing, is planning to officially announce
the launch of its A3XX 'super jumbo' on
Thursday after a board meeting.

The project received a further boost on
Tuesday when German economics minister
Werner Mueller pledged cash to help fund the
development of the new plane, which could
cost up to $12bn. (Ј8bn)

Britain has already pledged Ј500m to the
project, while France has also put aside funds
in next year's budget.

The new super jumbo aircraft would carry
between 550-650 passengers at ranges of up
to 8,700 miles (14,000 km).

It will create thousands of jobs across Europe,
with the UK's Bae Systems one of the main
contractors.

Who will build the plane?

The other members of the Airbus consortium,
France's Aerospatiale, Germany's Dasa, and
Spain's Casa would also have a key role in
construction.

But Dasa chief Rainer Hertrich said that a
decision on how to divide up the work will be
crucial to the launch decision.

The decision on Thursday is likely to be merely
the first stage before the first aircraft begins
commercial flight in around 2005.

The "authorisation to offer" will allow Airbus to
sign contracts with airlines interested in buying
the huge plane.

Airbus says it is confident that there is enough
interest the launch the A3XX, with four airlines
(Air France, Emirates Air, Singapore Airlines,
and leasing firm ILFC) already committed to
firm orders and several others (believed to
include Virgin Atlantic and Qantas) discussing
terms.

The planes are likely to cost between
$230mand $280m each, with a substantial
discount for launch customers.

But the move is a huge gamble by Airbus.

Boeing, which has said it does not believe
there is enough demand for the plane, could
launch a spoiling operation by developing a
stretched version of the 747.

Airbus says there will be a demand for 1,500
big jets, but Boeing estimates the world-wide
demand at closer to 360.

Complicated politics

The launch is complicated by the fact that
Airbus itself is supposed to become a
commercial company later this year.

And three of its four partners are also merging
to form the European Aeronautics, Defence
and Space Company (EADS), leaving Bae
Systems with the remaining 20%.

The French government will still have a stake
in the new company, prompting fears that it
will favour Toulouse as a production site.

Boeing is likely to strongly protest any
government aid in developing the A3XX.
BBC

Well Boeing would be up in arms, wouldn't it. We are talking about $120billon over the next 10 years in chinese sales alone, and the 747 plays a big part in that...