Airbus bags jet orders as Franco-Israeli dispute rocks air show
By Giulia Segreti, Paul Sandle and Tim Hepher
PARIS (Reuters) -Airbus bagged multibillion-dollar plane orders from Saudi Arabia and Poland on the opening day of the Paris Airshow clouded by a separate diplomatic dispute over France’s decision to shut down some Israeli stands for displaying deadly weapons.
Delegates expect this year’s iteration of the world’s biggest aviation trade show to see less business than usual, partly due to last week’s fatal crash of an Air India Boeing 787 and also because Boeing racked up huge deals during U.S. President Donald Trump’s recent tour of the Middle East.
But Airbus looks set to close a series of sales on its home turf, and interest in the defence side of the show is high as Europe ramps up military spending and conflict between Israel and Iran escalates.
Tensions between long-standing allies France and Israel flared up as the show was getting underway, when Paris ordered the main Israeli company stands to be closed down when they refused to remove attack weapons from display.
Israel’s ministry of defence condemned the move as “outrageous and unprecedented” and accused France of trying to shield its companies from Israeli competition.
Speaking to reporters by the black partitions erected to block off the Israeli stands, U.S. Republican Governor Sarah Huckabee Sanders described the French move as “pretty absurd”.
Show organisers said they were holding talks to try to “find a favourable outcome”.
The office of French Prime Minister Francois Bayrou said all exhibitors had been told ahead of the show that attack weapons would be prohibited from display and that the companies could resume their exhibits if they complied with this requirement.
Bayrou told reporters that given France’s diplomatic stance, and “in particular its … very great concern about Gaza”, the government had felt it unacceptable for such weapons to be on show.
SAUDI AMBITIONS, POLISH PLANS
Boeing’s CEO Kelly Ortberg and Commercial Airplanes boss Stephanie Pope have cancelled their trip to Paris and the U.S. company is scaling back its schedule at the event as it focuses on supporting the probe into last week’s Air India crash that killed more than 240 people in the first fatal 787 accident.
But Airbus was busy at the show working on deals.
Saudi leasing company AviLease said on Monday it had ordered 30 Airbus A320neo single-aisle jets and 10 A350 freighters in its first direct deal with the European planemaker.
That would be worth around $3.5 billion, according to estimated prices from analysts Cirium Ascend.
Saudi Arabia is spending big on becoming a new regional aviation hub, seeking to catch up with Dubai and Qatar by launching new airline Riyadh Air and announcing a massive six-runway airport.
Riyadh Air also signed a deal with Airbus for 25 A350-1000 long-haul jets worth an estimated $4.6 billion.
Both Saudi firms are units of the Public Investment Fund, whose leaders attended the show as part of a large Saudi delegation as the kingdom attempts to grow its tourism and cargo infrastructure and challenge the airline kingpins of the Gulf, Emirates and Qatar Airways, for a share of growing traffic.
European politics and realignments in security relationships were also driving one of the most political shows in years.
Polish national airline LOT announced an order for 40 Airbus A220s plus options for a further 44, confirming an earlier Reuters story and seen as a part of a broader reset of relations with France. The 40 jets are worth roughly $1.6 billion.
The deal followed a hard-fought contest between France-based Airbus and Brazil’s Embraer.
The competition attracted strong political attention as Warsaw moves to improve sometimes patchy relations with France amid questions over security pledges from the United States, according to European aviation and defence sources.
In May, France and Poland signed a treaty to increase cooperation on defence, nuclear energy and other measures, in a sign of growing alliances between European nations.
In other business, Japanese airline ANA finalised a previously announced Airbus order and industry sources have said Egyptair is close to an order for six more Airbus A350s.
Bloomberg News reported that Taiwanese carrier Starlux was also close to ordering more Airbus A350 planes.
U.S. arms firms were also pushing their wares as European rivals debate how to respond to higher spending, though there were few major announcements.
“Paris is traditionally a civil show but a lot of investors, especially those new to aerospace and defence, are coming this year, with perhaps overly high expectations with regards to defence news flow,” Agency Partners analyst Sash Tusa said.
(Reporting by Joe Brock, Tim Hepher, Paul Sandle, Giulia Segreti. Additional reporting by Steven Scheer in Jerusalem. Editing by Mark Potter)
