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 The move accelerates a growing interdependence between the European
firms on large jets, with General Electric GE.N - the main
alternative A330 engine supplier - no longer in the running for the
$2 billion "A330neo" revamp, they said on Thursday.
Shares in Airbus and Rolls-Royce both rose as much as 1.8 percent
against a flat market in early Friday trading.
The people, asking not to be named, said the provisional selection
of Rolls as sole supplier for the revamped A330neo, offering up to
14-15 percent in fuel savings with the help of new wingtips, remains
subject to Airbus Group board approval.
Board members at the Franco-German group are expected to meet in
coming days ahead of the July 14-20 Farnborough Airshow, which is
usually the showcase for major launch announcements.
It remains unclear whether Airbus will officially unveil the new
project at the world's premier aviation event, since it usually
waits to secure orders first.
Purchasing decisions are expected this year from some potential
launch customers such as Delta Air Lines DAL.N, which is currently
replacing Boeing 767 and 747 jets.
Airbus, which has promised investors a decision before the end of
the year on whether to revamp the 253- to 295-seat A330 passenger
jet, said none had been taken so far.
"We will have a comment when we have a decision. There is no
decision yet," a spokesman said.
Rolls-Royce said it was "not aware" of a final A330 decision having
been reached, and that any announcement would come from Airbus. GE
reiterated it had offered its GEnX engine for the revised jet, but
declined to comment on the commercial talks.
The A330 entered service 20 years ago and for years had looked set
to be overtaken by a new generation of carbon-composite jets such as
the 787 Dreamliner and soon the Airbus A350.
But following a three-year delay to the 787's arrival, sales of the
A330 held up much better than expected.
Now, however, the backlog of undelivered aircraft is dwindling
rapidly as the 787 recovers momentum, and Airbus is keen to inject
new life into its most profitable wide-body jet.
PRICE, AVAILABILITY
The Airbus-Rolls partnership raises the prospect of a potentially
bruising transatlantic battle for sales at the lower end of the
market for wide-body jets, which ranges from the 230- to 250-seat
A330-200 and 787-8 to the 525-seat A380 superjumbo.
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Airbus has said it will offer the refreshed A330 at significantly
lower prices than the 787 and match the newer plane's performance
per seat on most routes.
Boeing denies this but is preparing to put up a fight, with its
sales chief telling Reuters this month that it would "react" to the
relaunch of the A330.
Industry experts have speculated that Boeing could respond by
changing its one-size-fits-all 787 pricing strategy by offering
different prices for different levels of performance - a move seen
as a form of discounting.
But the U.S. planemaker is also expected to look just as hard at
ways of increasing availability of the 787, which is mostly sold out
until around the end of the decade. Boeing produces 10 787s a month
but targets output of 14 a month by end-decade.
The 787 is powered by engines from Rolls or GE, but industry sources
say GE is now expected to be more proactive in cutting deals with
airlines that help Boeing compete with the A330neo.
Both planemakers will be under pressure from investors to prevent
the contest developing into a price war that might destabilize wider
pricing and undermine profitability goals.
The A330neo will be launched in two versions, updating the A330-200
and A330-300. One casualty will be the smallest member of the Airbus
A350 family, the slow-selling 270-seat A350-800.
The re-engined A330 is accordingly expected to be marketed as the
entry point for Airbus's wide-body portfolio, prompting some in the
industry to give it a different name: the A350-200/300.
(Additional reporting by Alwyn Scott, James Regan; editing by
Laurence Frost and Jason Neely)
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