Monday, 29 May, 2017

Iran and Airbus to finalize deal within this week, A380s drop from contract

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By Vahid Jafarian, Editorial Board Member

Iran says the final deal to purchase around 100 planes from Europe’s Airbus to be signed within this week.

Iran’s transport minister Abbas Akhoundi was quoted as saying on Sunday that Tehran expected the Airbus deal to be signed within days. “We expect the final contract to be signed this (coming) week,” Abbas Akhoundi said, quoted by IRNA.

According to Iranian media, A team from Airbus is currently in Tehran for talks.

Iran reduced its order with Airbus to 100 planes in a contract that will no longer include A380s, Farhad Parvaresh, Iran Air’s chief executive officer, said in a press conference in Tehran. This will shrink the original $27 billion deal for 118 jets, including 12 A380s.

“Given there are now 100 planes in the contract, I don’t think that the overall value will exceed $10 billion, and that’s at the very most,” Parvaresh said. “The A330 was part of the deal from before and it still is, but there will be no A380.”

During a visit to Paris in January 2016 by Iranian President Hassan Rouhani, Tehran signed a major contract with Airbus worth about $27 billion to buy 118 planes.

In June, Reuters reported that doubts were growing about Iran’s planned purchase of 12 A380 planes as part of its proposed Airbus order.

In September, an Iranian official told Reuters that Iran had reduced the number of airplanes it planned to buy from Airbus by a further six amid delays in U.S. regulatory approvals.

An Iranian official told Reuters last Sunday that IranAir was at the “very final stage” of formalizing the deal with Airbus, which led Western companies back into Iran with a provisional agreement for 118 planes when Tehran emerged from global sanctions in January.

Airbus has already cut production of its superjumbo by more than half, to one plane a month by 2018, as demand has dwindled.

Iran also signed a $16.6 billion deal for 80 Boeing passenger jets last Sunday. As per the deal, the American firm will supply 50 737 MAX 8 aircraft, 15 777-300ERs and 15 777-9 to the Iranian carrier. Boeing said that deliveries will commence from 2018.

Iran, which is updating its aging fleet after U.S. sanctions were eased, is one of the few remaining untapped markets in which the plane-maker and rival Boeing Co. are competing for orders.

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