International Bureau Of Aviation Says Global Appeal May Prop Up The Airplane’s Order Book

While Emirates' cancellation of its order for 70 A350s will not pass by without some form of negative impact, aviation analyst International Bureau of Aviation says aircraft values are influenced more by their overall global appeal and complete order book.

The significance of Emirates’ order of seventy aircraft, worth around $22 billion, for their fleet is not actually a positive overall factor in the long term residual value business” says Dr Stuart Hatcher, Head of Valuations & Risk at International Bureau of Aviation (IBA).
 
According to IBA’s ‘JetData’ fleet database there are currently 34 A350-800, 539 A350-900 and 169 A350-1000 on order.  The 2014 IBA values for the A350 family are from $124m - $164m for the -800 to -1000 variants.
 
“The cancellation is no doubt bad PR for Airbus and the concern will be whether it is a simple matter of Emirates reviewing capacity requirements, or if the airline has been less than impressed with the overall performance factors - such as take-off performance at high temperatures, fuel burn, or range issues," Hatcher said. "Perhaps we will have a better understanding in the coming months.  With the Farnborough Airshow only five weeks away it is sensible for Airbus to get the bad news out so that they can make up ground with a positive message next month.”

(Image from file)

FMI: www.ibagroup.com