PARIS, Feb 1 (Reuters) – Airbus ( AIR.PA ) and Qatar Airways have settled a dispute over their A350 planes, avoiding potentially damaging litigation in a UK court after an 18-month dispute that tore apart the cap. outside the global jet market.
“Peaceful and mutually agreeable settlement” ends $2 billion dispute over long-haul jet surface damage. The dispute led to the withdrawal of billions of dollars in aircraft contracts by Airbus and prompted Qatar to increase purchases from Boeing.
Canceled orders for 23 undelivered A350s and 50 smaller A321neos have been reinstated under the new deal, which is expected to pay the Gulf carrier several hundred million dollars while Airbus gets a reprieve from other lawsuits.
Financial details have not been made public.
The companies said none of them were responsible. Both promised to drop the allegations and “move forward and work together as partners.”
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The deal amounts to an unprecedented public divorce trial between heavyweights in the normally tight-knit and secretive $150 billion jet industry.
The two sides filed combined claims and counterclaims worth nearly $2 billion before the June trial.
French Finance Minister Bruno Le Maire welcomed the deal, which comes after increased political involvement amid close ties between France and Qatar, where Airbus is based.
“This is the culmination of a significant joint effort. This is great news for the French aerospace industry,” he said.
Airbus shares rose 1% ahead of the announcement.
Qatar Airways has taken the unusual step of publicly challenging the world’s largest planemaker over safety after paint cracks on its next-generation A350 carbon-composite jets revealed gaps in the lightning protection underlay.
Airbus acknowledged the quality flaws but insisted the planes were safe, backed by European regulators, accusing the airline of exaggerating the defects to win compensation.
Backed by a growing army of lawyers, the two sides repeatedly argued in preliminary hearings over access to the documents, much to the growing frustration of the judge, who was forced to order cooperation.
Analysts said the deal would allow both sides to feel vindicated, with Qatar Airways winning damages and admitting the problem was outside of the manual and therefore requiring a new fix, and Airbus being spared the difficult task of finding a home by staying safe. It canceled the A350s.
Qatar will receive the much-needed A321neos in 2026, albeit three years later than expected, to plan for its growth. Airbus’ decision to cancel this order, separate from the controversial A350 contract, was criticized by global airlines group IATA.
Airbus said it was doing its best not to push Qatar too far back in the queue, although some experts doubt it will be able to meet the previous schedule due to supply problems.
The settlement is also expected to stop the clock ticking on a $6 million-a-day claim for ground damages caused by an agreed clause after a World Cup jet repaint caused serious surface damage.
Originally valued at $200,000 a day per plane, Airbus’ notional liability grew to just $250,000 an hour for 30 planes, or $2 billion a year, by the time the contract was awarded, according to court documents. Neither side commented on the details of the settlement.
Airbus said it would now work with the airline and regulators to provide the necessary “repair solution” and get Qatar’s 30 grounded planes back into the air.
Confirmation of the deal came after Reuters reported a deal could be reached as early as Wednesday. In 2021, a Reuters investigation revealed that other airlines were affected by A350 skin degradation, all of which said it was “cosmetic”.
The debate focused on the design of modern carbon fiber jets, which do not interact as smoothly with paint as traditional metals, and shed light on industrial techniques.
Additional reporting by Leigh Thomas, Michelle Rose Editing by David Goodman, Diane Craft and Gerry Doyle
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