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Airbus to pay China Southern $250m for delayed A380 delivery

By Hao Yan (chinadaily.com.cn)
Updated: 2009-07-10 12:57

Airbus has again postponed delivery of the first A380 jumbo jet to China Southern Airlines to 2011, citing technical reasons, and will pay $250 million in compensation to the carrier for the delay, Guangzhou Daily reported Thursday.

Related readings:  Airbus delivers 1st China-assembled A320 jet  China Eastern Air to buy 20 Airbus A320 jets  China's top airlines may return to profit this year  China Southern to ride out of turbulence

Immature A380 technology, together with lack of passenger resources and accommodating facilities at airports, has repeatedly delayed the debut of A380 in Guangzhou, which will host the Asian Games next year, the newspaper said.

The compensation to China Southern would be enough to buy another A380, the report said.

Si Xianmin, chairman of China Southern, said a delay in purchasing A380s is also the best choice for the carrier at a time when intercontinental passenger numbers have been decreasing, for A380's advantage lies in long-haul intercontinental routes.

The airline has been putting off necessary adjustments to accommodate such incoming aircraft as the A380, cutting transport capacity and abandoning out-dated models to cope with shrinking demand caused by the economic slowdown.

Delivery of the A380s has been put off repeatedly worldwide owing to technical issues. The first A380s ordered by China Southern were previously scheduled for delivery by 2007.