Exclusive: GE finances first A350 powered by rival Rolls-Royce
By Tim Hepher
PARIS (Reuters) - When the Airbus (AIR.PA: Quote) A350 jet made its commercial debut with Qatar Airways this week, the event marked a milestone for engine supplier Rolls-Royce (RR.L: Quote), but slipping unnoticed under the radar with financing was its arch-rival General Electric (GE.N: Quote).
Although powered by the latest generation of Rolls-Royce (RR.L: Quote) engines, the first of a new series of jets on which the company has bet its civil business is owned by GE's aircraft leasing arm GECAS, Reuters has learned.
The rare decision to invest in rival technology highlights the complexities of keeping ahead in a highly concentrated aviation industry, with GECAS seen as keen to diversify its portfolio even though its parent GE is perceived in the industry as more and more aligned with Airbus rival Boeing (BA.N: Quote).
The deal also completes a series of twists in the history of Airbus's newest jet: a journey that insiders say has helped to reshape transatlantic aerospace competition.
In this case, the world's largest lessor agreed to buy the aircraft from the airline immediately on delivery and rent it back, a routine type of financing called sale-and-leaseback.
It is not the first aircraft equipped with rival engines to end up on GECAS's books but such deals are usually kept low key and seldom if ever happen on a high-profile debut of a new jet.
The first A350 was delivered to Qatar Airways in a lavish ceremony last month in which Rolls-Royce had a starring role, but GE's involvement in the financing was not mentioned.
The head of the airline confirmed the deal to Reuters. Continued...