China stalls Airbus approvals to pressure Europe on homegrown Chinese jets, Bloomberg News reports
China Delays Airbus Deliveries Amid European Certification Dispute
Background on Airbus Delivery Delays
May 26 (Reuters) - China has been stalling the approval of Airbus deliveries to signal impatience with European regulators' delay in certifying Chinese-made COMAC aircraft, Bloomberg News reported on Tuesday.
The Civil Aviation Administration of China (CAAC) has delayed final approval that would allow Airbus jets to enter the country and be put into service for the past several months, the report said, citing people familiar with the matter.
Impact on Airbus Operations
Airbus delivered the fewest commercial jets in the first quarter since 2009, according to the report. Chief Executive Guillaume Faury said last month the delay was due to an "administrative topic" that held up almost 20 aircraft destined for China.
On Airbus' April 28 earnings call, Faury said the issue had been resolved and that the undelivered planes would be shipped in the second quarter.
Financial Implications for Airbus
Chief Financial Officer Thomas Toepfer said Airbus had built up around 5 billion euros ($5.82 billion) of inventory in the quarter, significantly more than the prior year, with the China delivery halt the main driver. He said the aircraft "had been built and were ready, but could not be delivered."
European Certification of COMAC Aircraft
In January, Reuters reported that Europe's aviation safety regulator, EASA, had been carrying out test flights to assess COMAC's C919 jet for certification, which would allow the Chinese planemaker to market the jet to Western airlines for the first time. At present, European and other Western carriers cannot fly COMAC's jets.
EASA's Progress and Statements
In a statement, EASA said work on the validation of the C919 is "progressing with the full cooperation of COMAC and the CAAC," but added that it could not comment on the expected timeline for completion of the validation project.
Potential Market Impact
EASA safety certification would significantly expand COMAC's global footprint, as the C919 competes directly with Airbus' A320 and Boeing's 737.
Industry Response and Additional Information
Airbus, CAAC and COMAC did not immediately respond to a Reuters request for comment. Reuters could not immediately verify the report.
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(Reporting by Anusha Shah in Bengaluru, Julie Zhu in Hong Kong and Sophie Yu in Beijing; Editing by Muralikumar Anantharaman, Christian Schmollinger and Thomas Derpinghaus)
