Fedex Cancels Airbus A380 Order, Defects to Boeing November 7, 2006

Posted by Andrew in Airbus

Fedex, frustrated with delays in the Airbus A380 program, cancelled its order for ten of the aircraft in the freighter configuration early this morning. Citing “significant delays for delivery of A380s” and a need to meet the growing global package demand, the freight carrier elected to purchase the Boeing 777F instead of the much larger Airbus A380 aircraft. In response to the largest blow dealt to the Airbus A380 program, an Airbus spokesman said that “Airbus regrets FedEx’s decision but understand[s] their need to urgently address capacity issues.” Although Dubai-based Emirates has been threatening cancellation in recent months, Fedex is the first major carrier to follow through. Fedex’s cancellation came as a surprise to the aviation industry this morning; United Parcel Service, the main competitor of Fedex was rumored to be considering a cancellation, but such an action was not expected from Memphis based Fedex. The Boeing 777F, scheduled to be first delivered in 2008, is not seen as a replacement for the A380. The Boeing 777F is of comparable size to the MD-11, the backbone of Fedex’s widebody fleet. With MD-11’s becoming more difficult to acquire, many see Fedex’s purchase of triple-sevens as a move to augment an aircraft size that serves the company well. Fedex indicated that the decision to purchase the Boeing 777 freighter variant came as a result of the recently announced delays. The freight company, an early proponent of the Airbus A380 program, noted however that it will continue “to be Airbus’ largest wide-body airplane customer and will add additional new and used Airbus wide-body aircraft to its fleet in the coming years.” Boeing did not comment on the recent deal, however investors rewarded the company by boosting its shares on news of the deal.

Source: Reuters