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Saturday, March 23, 2013

Rumor: JAL might place an order of 20 Airbus 350-1000's

JAL might place an order of 20 Airbus 350-1000's by June 2013
JAL might place an order of 20 Airbus 350-1000's by June 2013. Image from Airbus

Japanese newspaper Nikkei reports without citing its source that Japan Airlines (JAL) is studying the Airbus 350-1000 at the moment and might place an order of 20 planes for delivery from 2017 to replace its Boeing 777 fleet currently used on long-haul flights to the US and Europe.

Up till now, JAL is one of the few airlines who has never placed an Airbus order. The only Airbus planes on its fleet were acquired through the Japan Air System (JAS) merger and JAL has retired those Airbus 300-600R's since then. With the exception of the regional jets, Boeing will be the only manufacturer of JAL fleet when JAL retires the MD-90 which are manufactured by McDonnell Douglas (MD but has merged with Boeing so they are technically Boeing planes now :P) on March 30 2013.

It's no secret that JAL honorary chairman Kazuo Inamori, who will be retired by the end of the current fiscal year, is a supporter of the dual vendor system. He even went onto record to say a dual vendor system is preferred and relying 100% on Boeing is abnormal during the CNBC interview back in February 2013. And this will also lower the costs when the two vendors try to undercut each other in cost!

JAL has been deliberating on introducing the second vendor for a while. Nikkei reports that after studying on capacity and pilot training facilities, the 350-seat Airbus 350-1000 seems to be a good fit for JAL's needs. The initial order will consists of 20 planes which worths around 400 billion at listed price although airlines usually receive huge discount when placing a large order. The final decision of the purchase will be made in June.

I guess the other option JAL is studying is the Boeing 777X which rumor has it Boeing has offered JAL to be the launch customers. It will be a blow to Boeing which is a dominant player in Japan and lose yet another big Boeing exclusive customer. But what JAL is trying to do is to reduce its reliance on  a single vendor and lower its costs. The recent 787 grounding definitely does not help Boeing's case. Of course this could also be a smoke screen so JAL can get a lower price from Boeing :P




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