Emirates buys 15 Airbus jets in reprieve from engine row

Airbus won a consolation order for 15 A350-900 jets from Emirates on Thursday after a public row between the Mideast giant and engine maker Rolls-Royce prevented a bigger deal for European jets at a Dubai Airshow dominated by Boeing.

Emirates Chairman and CEO Sheikh Ahmed bin Saeed Al Maktoum said the long-haul jets would "add to our fleet mix, and we are pleased to announce additional orders for this aircraft type."

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However, industry sources described the deal as a face-saving compromise after the influential carrier criticized the amount of maintenance needed to keep the engines for the larger A350-1000 flying in hot and sandy conditions of the Gulf.

Sheik Ahmed said Emirates would "work closely with Airbus and Rolls-Royce to ensure our aircraft deliver the best possible operating efficiency and flying experience for our customers."

The deal, which Emirates said was worth $6 billion, followed intense negotiations focusing on the needs of the Gulf as it fends off new competition from Turkey, India and elsewhere to its East-West transit model, while shedding light on broader industry tensions over rising engine costs.

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Emirates is by far the biggest user of the Airbus A380 after investing heavily in the world's largest airliner, and is now planning the fleet needed to keep its Dubai super-hub at the center of the aviation map beyond the 2030s as the A380 retires.

The airline opened this week's air show with a $52 billion order for 90 Boeing 777X airplanes, saying the U.S. planemaker appeared to be getting a grip on regulatory and other problems surrounding its entry to service after five years of delays.

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But Emirates Airline President Tim Clark refused to place a large order for Airbus' broadly similar A350-1000 and blasted Rolls-Royce over the disruption and cost of dealing with frequent maintenance needed to keep the plane's engines running.

Emirates would have ordered 35-50 of the planes, he said.

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Rolls-Royce acknowledged its engine for the A350-1000 would need more servicing than Emirates would like, but denied Clark's suggestion that the XWB-97 engine was "defective."

Chief Customer Officer Ewen McDonald said deal for the A350-900, which uses a different variant of engine, was a sign of the airline's trust in Rolls-Royce and held out hope for a future order for the A350-1000.

"We will continue our discussions with Emirates on the A350-1000 engine improvements and look forward to them choosing this aircraft in the future," he said.

Emirates has already ordered 50 A350-900s which are scheduled to arrive from August next year.

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Delegates said earlier a top-up order would be seen as a consolation prize for Airbus and Rolls-Royce after Boeing and its main engine supplier GE. GE. won the majority of deals, but would leave questions over Airbus's ability to compete with Boeing's 777X in the lucrative Gulf market.

Ticker	Security	Last	Change	Change %
GE	GE AEROSPACE	178.70	+0.72	+0.40%

"It is...just to keep the relationship going and so they can talk again," a senior aviation industry source said.

Investors are expected to quiz Rolls-Royce about the durability and pricing of its engines at a Nov. 28 investor day.

Rolls-Royce said earlier in week it was looking at applying technology from its Ultrafan research project to the XWB-97.

BOEING DOMINATES ORDERS

In a week dominated by soaring demand for wide-body planes, Boeing won new orders for 196 aircraft while Airbus agreed deals for 55 jets.

Airbus said it had reached an "agreement in principle" for a significant order from Turkish Airlines, but industry sources said the deal had not yet been signed.

Emirates also agreed to buy five additional 787 Dreamliners, while sister airline flyDubai went for 30 with its first wide-body order.

Although political power is consolidated in the UAE capital Abu Dhabi, Monday's high-profile announcement overseen by Dubai's crown prince was symbolic of the value the UAE places on its bilateral relationship with the United States after a recent period of strain, said sources familiar with the matter.

Ticker	Security	Last	Change	Change %
BA	THE BOEING CO.	143.41	-2.67	-1.83%
RYCEY	ROLLS-ROYCE HOLDINGS PLC	6.88	+0.13	+1.93%
EADSY	AIRBUS SE	36.59	+0.20	+0.55%

In other business, Turkey-based budget carrier SunExpress announced an order for 45 Boeing 737 MAX narrow-bodies and used the spotlight to issue a reminder of the industry's supply chain problems.

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Ethiopian Airlines announced it was buying 20 737 MAX jets nearly five years after the fatal 2019 MAX crash that led to the grounding of the global fleet. It also ordered 11 Dreamliners.

EgyptAir said it was ordering 10 A350-900s from Airbus, while AirBaltic announced it was buying 30 Airbus A220-300s.

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Royal Air Maroc signed a repeat order for two additional 787 Dreamliners. EgyptAir said it would lease 18 new Boeing 737 MAX jets from Air Lease Corp.