UK flagship airline British Airways yesterday confirmed it was choosing four Boeing 777 aircraft, with options for four more, ahead of Airbus A330s as it starts expanding its long-haul fleet.
"It was a very close decision between the Boeing 777s and Airbus A330s," said Robert Boyle, the airline's commercial director. "However, the ease of assimilating up to eight aircraft into our existing 777 fleet, rather than having a small number of A330s, swung the balance in Boeing's favour."
"We already have 43 of the 777 aircraft, and that was the tipping factor."
The Boeing 777-200ER is a long-range, twin-engined plane that typically seats 301 passengers.
High oil prices have helped its sales as airlines look to replace older, less efficient older models. The airlines have shunned the nearest Airbus equivalent, the fuel-thirsty, four-engined A340.
The deal is further bad news for Airbus, which this week postponed a major announcement on job cuts, saying European nations could not agree how to share the work on its next aircraft, the wide-body A350.
The surprise statement followed a stormy board meeting at parent EADS on Sunday, at which the group failed to sign off on management's Power8 restructuring plans, seen as crucial to the future of Airbus.
British Airways is starting a major programme of fleet renewal and expansion, with 20 of its older 747s and 14 of its 767s due to be replaced.
Analyst Andrew Fitchie at Collins Stewart said yesterday's deal signalled confidence at BA, as it had pledged to get on track to achieving a ten per cent margin target before placing any order.
Mr Boyle said the next big order would be made in the second half of 2007, at which point the ease of assimilating the planes would be less of an issue.
"The competition is still wide open," he said.
The four Boeing 777-200 ERs, worth about $800 million (#408 million) in total, are scheduled for delivery in early 2009, and options have been taken out for a further four to be delivered in 2010.
Industry sources said Airbus had faced a tough time trying to win the order as BA had excluded from its list of candidate aircraft the four-engined Airbus A340, a plane which competes directly with the twin-engined 777, but is more expensive to operate.
Airbus said yesterday it had sold four smaller single-aisle A320s to British Airways, worth about $270 million (#137.7 million) at list prices.
British Airways said it was still negotiating with General Electric and Rolls-Royce about which engines will be used for the new Boeing 777 aircraft. Airbus lost the annual battle for plane orders to Boeing for the first time in six years in 2006, posting 790 net orders versus Boeing's 1,044.
Airbus' problems this week exposed continued tensions between the four countries where its plants are based – Britain, France, Germany and Spain – as the firm's chief Louis Gallois prepares to axe up to 10,000 jobs or a fifth of its workforce.
Airbus has been hit by almost two years of management and shareholder disputes, changes in ownership and political tensions as the A380 superjumbo project turned sour, beset by technical and budgetary problems.