Airbus versus Boeing Japan battle switches to ANA

Tue Oct 8, 2013 1:13pm EDT
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By Siva Govindasamy and Tim Hepher

SINGAPORE/TOULOUSE (Reuters) - Stung by the loss of a multi-billion dollar jet order from Japan Airlines (9201.T: Quote) to arch-rival Airbus EAD.PA, Boeing (BA.N: Quote) will mount a all-out defense of its position with Japan's other major airline, ANA, a source close to the U.S. planemaker said.

Boeing executives are still trying to understand why long-time customer JAL ordered 31 Airbus A350s - worth $9.5 billion at list prices - in a deal, announced on Monday, that was the U.S. company's first major loss in Japan.

ANA Holdings Inc (9202.T: Quote) wants around 35 aircraft to replace its long-haul Boeing 777s and, like JAL, is considering both the A350 and the Boeing 777X, the re-engine, updated variant of the popular long-range wide-body jet.

After the JAL setback, ANA is fast becoming a "can't lose at any cost" deal for Boeing, whose executives are under pressure to "do everything they can" to win the deal, said an industry source close to the U.S. planemaker.

The United States' close diplomatic ties with Japan, a key U.S. ally in East Asia, could help Boeing's cause, according to industry sources.

The U.S. company's relationship with Japanese industrial giants Mitsubishi Heavy Industries (7011.T: Quote), Kawasaki Heavy Industries (7012.T: Quote) and Fuji Heavy Industries (7270.T: Quote), which collectively make around 35 percent of Boeing's 787 and are major suppliers for its other aircraft, is another factor that could work it its favor at the political level.

Boeing declined to comment on its ANA strategy.

Despite Monday's victory, Airbus is widely seen as the underdog in the tussle for ANA's business, industry experts say.   Continued...

The Boeing logo is seen at their headquarters in Chicago, April 24, 2013. REUTERS/Jim Young