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Airbus Kills $6 Billion Deal With Qatar Airways For 50 New A321 Jets as Lawsuit Court Date Set

Airbus Kills $6 Billion Deal With Qatar Airways For 50 New A321 Jets as Lawsuit Court Date Set

European aircraft manufacturer Airbus has revoked a deal with Qatar Airways for 50 brand new A321neo aircraft in a tit for tat move after the two aviation giants became embroiled in an increasingly acrimonious legal dispute.

The deal for the popular and highly sought after A321neo is worth around $6.35 billion at list value. Qatar Airways eas expected to receive its first A321neo in 2023 with deliveries expected to conclude by 2032.

The decision by Airbus to kill off the deal is believed to be in direct response to a lawsuit that Qatar Airways has filed in London’s High Court against the airframe. Qatar Airways is seeking $618 million in compensation from Airbus because of a paint defect on some of its A350 jets.

Airbus says it plans to “vigorously defend” itself against the legal claim and maintains there is no justification for a decision by Qatar Airways to refuse delivery of two A350 planes that are ready to be handed over.

In new legal filings obtained by Bloomberg, Airbus says “there is no reasonable or rational basis” for Qatar’s aviation regulator to have ordered the grounding of 21 of Qatar Airways’ A350’s.

But Qatar Airways either “sought to engineer or has acquiesced” in the decision to ground the planes because it was in the loss-making airline’s economic interest to do so “given the impact of the coronavirus pandemic”.

Qatar Airways has reactivated some of its A380 superjumbos and also leased aircraft from Oman Airways to bump up capacity due to the ongoing A350 groundings.

The Doha-based carrier brought the legal proceedings after Airbus allegedly failed to establish the root cause of a paint defect on some A350s in which the paint cracks and bubbles and exposes a special lightning protection layer.

Both Airbus and Europe’s air safety regulator have concluded that the paint defect is purely cosmetic and that there is no justifiable reason to ground the A350’s over safety fears.

Other airlines including Cathay Pacific and Finnair have experienced similar paint defects but no other airline or regulator has grounded the A350 over the issue.

The initial hearing is scheduled for April 26, while Airbus has been ordered to serve its defence by the end of February. Airbus says it will “deny in total” the claim by the Gulf carrier but Qatar Airways wants the matter resolved in time for the FIFA World Cup which is due to start in November.

If the dispute drags on, a lawyer for the airline said Qatar Airways would not have enough capacity to handle the expected influx of visitors to the country.

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