Emirates throws down gauntlet to Boeing and Airbus
Carrier warns it will not take new planes until reliability of engines improves
Sir Tim Clark, president of the world’s largest international carrier, on 4th September, said he was “fed up” with receiving aircraft that did not meet contract specifications and were beset by problems.
“We would be foolish in my view to start adjusting or coming up with new contracts until we are absolutely sure that these aircraft are going to do what they said they would, I think propulsion is an issue for us, and I’m a little bit irritated,”he said.
“When they don’t give me the aeroplanes and engines that work, it’s over. Now you produce what you say you will produce”. He added: “I cannot afford to have aircraft coming in and out of the fleet because engines have to be changed etc. Give us airframes and engines that work from day one. If you can’t do it, don’t produce them”
Sir Tim’s warning comes after Boeing confirmed in July that the first flight of its new 777X wide-body jet was delayed from late 2019 until early 2020 because of problems with the engine provided by General Electric.
Boeing is still targeting first delivery of the 777X in late 2020 but has warned that the engine issue had added “significant risk” to this schedule. Emirates has ordered 150 777Xs as well as 40 787s. However, the 787 order was nowhere to be seen, hinting that the carrier might have canceled the $15.1 billion order from Boeing as the result of constant Rolls-Royce Trent 1000 engine issues that the Dreamliner program is plagued with.
Sir Tim also pointed to the carrier’s plan to order 70 smaller A330neo and A350 jets from Airbus as part of a plan to diversify its fleet and a restructuring of its existing A380 contract with the company.
He said Emirates was prepared to complete that contract months ago but said he had concerns that Rolls-Royce, the engine manufacturer, was not in a position to provide the engines “under the rules of the game established”.
Rolls-Royce said the company was committed to maintaining its strong relationship with Emirates. “We are entirely confident in the reliability and performance of our engines, and in our commitment to meeting the high standards expected by our customers,” the company said.
Sir Tim’s comments come as relations between Rolls-Royce and its airline customers have been damaged by the problems on its Trent 1000 engine that powers Boeing’s 787 aircraft. Airlines around the world have had to ground aircraft, disrupting their schedules.
The Dubai-based airline, followed by Qatar Airways and Abu Dhabi’s Etihad, has disrupted the aviation industry over the past two decades with their superconnector model, linking east and west through three Gulf hubs.
The collapse in oil prices in 2014 ushered in a sustained economic slowdown, softening demand, while the US travel bans on some Muslim countries and European terrorist attacks hampered travel. In May, Emirates reported a profit of Dh871m ($237m), its weakest earnings in a decade.
Sir Tim on Wednesday said he expected a “diminishing growth” of air travel, predicting that air traffic growth could fall by about 2 percentage points over the next three to five years.
But he denied that engine concerns were just a way to slowdown its large order book.
“We have always honoured our obligations contractually to the aerospace community. This is not an attempt to slow things with regards to our obligations under contract. It is just a re-establishment of the rules of the game, which I do not think are unreasonable,” said Sir Tim.
He said he remained keen on the aircraft it had ordered. “These are hugely potent aircraft that eventually will get all their operations sorted out . . . these are outstanding designs. Unfortunately, they are not being put together as well as they should be.”
FINANCIAL TIMES Tanya Powley, Transport Correspondent
Additional reporting by Sylvia Pfeifer