Airbus SAS parent EADS NV (EPA : EAD) regretted to announce on Tuesday that Fedex (NYSE: FDX) had cancelled its 10-plane Airbus A380 order. This news hit the stock hard after Tuesday’s close but the stock seemed to rebound back to its weekly average by Wednesday morning over in Europe. It looked particularily bad at one point when the stock was down to 20.42 per share. As of now, the stock is trading around 21.24 and up on the day. After the cancellation, Airbus still has orders for 15 more cargo versions of the A380.  With this delay there has been some concern that more cancellations will follow.
The cancellation was brought on by “significant” delays, being blamed on persistent manufacuring problems. In order to fulfill their aircraft demands, Fedex has decided to go with Airbus rival manufacuter’s Boeing (NYSE : BA) 777 Freighter plane. They put in an order for 15 planes with an option for another 15. This is big news for Boeing who seems to continue to gain orders as people leave Airbus’s Superjumbo behind.
2 thoughts on “Fedex Cancels Airbus A380 Order”
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I do not understand why the 380F should be delayed. Surely the wiring problems only apply to the passenger version?
They have mentioned that they have been having internal issues with the construction of the plane. They never seem to go into detail about what these issues might be though. Emirates Airlines will be sending a team of engineers to the Airbus facilities to take a first hand look at the processes. So if we see Emirates cancelling their order things at Airbus will be very bad.
There was also some speculation that the delays could be blamed on component suppliers. However, this has been denied and Airbus has said they are reducing the number of supplier from 3,000 to 500 for financial cost cutting.