Airbus Nearing Deal With China For More Than 100 Jets

By Yannick LeJacq | August 27 2012 1:15 PM

Airbus SAS, the French aerospace company and subsidiary of the Netherlands-based European Aeronautic Defence and Space Company N.V. (EPA:EAD), is nearing a deal with the Chinese government to sell more than 100 aircrafts.

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Airbus SAS, the French aerospace company and subsidiary of the Netherlands-based European Aeronautic Defence and Space Company N.V., is nearing a deal with the Chinese government to sell more than 100 aircrafts.

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If successful, the deal will become the Tolouse-based manufacturer's largest agreement so far this year.

Sources speaking to Bloomberg reported that Airbus CEO Fabrice Bregier is planning to travel to China this week, joining EADS CEO Tom Enders for negotiations. Enders himself is traveling with German Chancellor Angela Merkel, who is currently on a state visit to China.

If completed, the alleged deal would help Airbus regain its competitive footing against its chief industry rival Boeing Co. (NYSE: BA). Boeing has boasted a strong lead over Airbus in recent months thanks to the enormous popularity of its new 737 MAX single-aisle aircraft.

Earlier this summer, Boeing secured its position atop the European market with a multibillion-dollar commitment from Air Lease Corp. (NYSE: AL). It extended this lead into the beginning of Auguest with an auspicious deal with Singapore Airlines Ltd. (Singapore: C6L).

But more recently, the sales gap between the two aerospace giants has been narrowing as Boeing began to lose orders of its own and China itself expressed interest in breaking the Airbus-Boeing market duopoly by building up its domestic aerospace companies.

The terms of the agreement are still being negotiated, anonymous sources said to Bloomberg, though Airbus' team in China has expressed its goal to make 284 single-aisle jets through its facility in Tianjin, China, by June 2016.