This story is about one of two major manufacturers and a global and growing airline. The manufacturer wants to sell aircraft, the airline wants to buy and use them to extend its network. There should be little that could go wrong with this, but gone all wrong it has and on full display for the whole world to see. This story has been covered by numerous news outlets, including probably all that cover the aviation industry. Still, it may be worth reiterating the story and add some reflections to this, as it is still ongoing and may still escalate further.
In an unexpected move, Airbus recently cancelled an aircraft order for 50 A321s from Qatar worth 6 billion USD (link). While airlines regularly delays, changes or cancels order, the cancellation of an order by a manufacturer is a very rare move. An Airbus statement simply concluded: “We confirm we did terminate the contract for 50 A321s with Qatar Airways in accordance with our rights”.
The Airbus action was in response to Qatar repeatedly and increasingly loudly voicing their complaints about flagging surface paint on their A350 aircraft. Recently the airline circulated pictures of the damage and expressed concerns about lightning protection systems, underlying composite structures being expose and showing signs of cracking, damage around rivets on the aircraft fuselage and other defects. In response the airline has grounded 21 out of their 53 A350s. After threats of court action, in December last year the airline took the manufacturer to court for the alleged problems with the aircraft. A hearing is scheduled for late April and the airline is seeking 618 million USD, plus 4 million USD per day, as compensation from the manufacturer.
There have been a number of steps on the way to the current situation, which have included involvement by IATA, EASA, Qatar CAA and others. There are many details about this story but covering even some of them would make this a very long post. In addition, there are probably as much information and political manoeuvres behind the scenes as in public view. It should however be noted that Qatar Airways is the only airline with this problem that have decided to ground affected aircraft.
As for the two parties involved in this, on the one hand we have Qatar Airways, represented by their CEO Akbar Al Baker. He has a history of courting controversy, often triggered by his own statements. He has made inflammatory statements about women in the aviation industry, for which he later apologised. He has threatened to leave the OneWorld alliance, called the Delta CEO a “bully” and “liar” and regularly and publicly expressed direct criticism towards other competitors, manufacturers and others. Al Baker has expressed his respect for Ryanair’s CEO Michael O’Leary and it is difficult to not wonder if his statements reflect a similar strategy of using provocation to get attention and then benefit from the free media exposure that comes along with it.
On the other hand we have Airbus, the at this point in time more faceless giant manufacturer. They seems far less interested in the attention they are getting for this situation, especially as this follows a very expensive settlement of bribery charges in 2020. It is not hard to see why the manufacturer would rather have the situation with Qatar Airways go away but even accepting the loss of a large order may not be enough to achieve this. Willie Walsh, Director General of IATA, expressed concern in reference to the Qatar Airways and Airbus situation about suppliers exploiting market strength.
Regardless of who is right or wrong in this ongoing conflict, this is a situation that should have been resolved before it became a global news story. The current media attention on does nothing good for anyone of the parties involved or for the aviation industry. More than this is not really possible to say with any certainty until more information about what went on behind the scene becomes available. What can be said with certainty is that this will surely become a case study used in aviation management courses everywhere. At least there may be a lot of learning from it by then.