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Boeing, Airbus Backed Up

The inaugural flight for Boeing's 787 Dreamliner has been put off for as long as three months.
The inaugural flight for Boeing's 787 Dreamliner has been put off for as long as three months. (By Kevin P. Casey -- Bloomberg News)

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By Emma Vandore
Associated Press
Thursday, January 17, 2008

TOULOUSE, France, Jan. 16 -- The problem for Airbus and Boeing isn't too few customers, it's making planes fast enough to meet demand.

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Together, the rivals got 2,754 orders last year. Airbus said Wednesday that it beat its U.S. rival in deliveries, 453 to 441, though it took fewer orders, 1,341 to Boeing's 1,413.

Both companies have struggled to get new models to the airlines lining up to buy them.

Airbus said that its backlog would increase this year -- even as new orders slow -- and that its passenger jets are mostly sold out through 2011.

Boeing said that it would put off for as long as three months the inaugural flight of its 787 Dreamliner because of supply-chain problems and manufacturing delays.

The delay means Boeing won't be able to begin delivering the airplane until early 2009, instead of late this year.

Boeing's 787 program has been delayed twice before. In October, Boeing said it was pushing back flight testing until March and delivery to its first customer, Japan's All Nippon Airways, to the end of 2008.

Scott E. Carson, president and chief executive of Boeing's commercial airplanes unit, said he was "deeply disappointed" by the latest delay but that the program was sound. "When we have tested the technology and its application to this new family of airplanes, our confidence has only increased," he said.

Airbus's flagship A380 super-jumbo jet has also been delayed, and the company had to redesign its planned competitor to the 787, the A350.

Despite expectations that high oil prices and a credit squeeze would hurt the airline industry, both companies are riding a boom in the sector that has lasted three years, partly because of demand from Asian airline companies.

"Cycles in this industry used to be peaks and, I guess, sort of canyons or big troughs," said John J. Leahy, Airbus's chief salesman. "Now it looks like we are getting more hills and valleys."

Thomas Enders, the Airbus chief executive, said he expected "demand to continue to be strong" in 2008, though not as high as in 2007.

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