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. Last Updated: 07/27/2016

Airbus Inks $5.1Bln Deal With Qatar

LE BOURGET, France -- Planemaker Airbus strengthened its lead in new orders over rival Boeing on Thursday with a $5.1 billion deal from Qatar Airways.

Airbus has notched up a 59 to 0 lopsided victory over Boeing in firm orders placed at the Paris Air Show as the French-based planemaker grabbed a commanding lead for the year.

Tiny Qatar -- its population is well under a million -- was kicking off plans to more than double its all-Airbus fleet in the next five years by buying 18 more but said Boeing might supply planes in the future.

Qatar chief executive Akbar al-Baker told reporters: "We have to talk to two aircraft manufacturers ... competition is healthy."

The deal marked a blow for Boeing, which Qatar said last week was still in the running to provide it with several wide-body 777s.

Boeing's biggest deal at this week's show, the industry's biggest showcase, has been a memorandum of understanding to sell nine planes to Korean Air that the planemaker said it expected to convert into firm orders worth $1.5 billion in the next few weeks.

Korean also signed a memorandum with Airbus for five planes.

Qatar bought 14 Airbus A330s to be powered by GE Aircraft Engines and two A340-600s for which British aero-engine maker Rolls-Royce will provide engines.

Deliveries are set to begin next year in a deal that included the purchase of two of Airbus's smaller A321 model as well as options to buy 14 additional planes of the two larger types, Airbus said in a statement.

Qatar said it was in talks with international banks that were expected to fund the purchase with syndicated loans.

Rolls-Royce said its stake in the plane deal could be worth up to $750 million including servicing if Qatar converts options it took on eight A340-600s.

Top long-haul airlines have struggled since 2001 with oversupply, weak economies and feisty low-fare carriers all eating into earnings.

"A feeling that the crisis is behind us is totally false," Airbus chief executive Noel Forgeard told reporters Thursday about the airlines market.

Still, the picture has been different in the Middle East, where a battle between two government-run carriers has helped sustain demand for the industry's newest planes.

Qatar's fast-growing rival Emirates ordered 41 Airbus aircraft, including the 555-seat Airbus A380, on Monday at Paris.

Qatar's al-Baker said he was also ready to firm up plans to buy the plane, which will be the world's largest airliner.

"We have signed a letter of intent ... we expect to sign a final agreement by the end of next month," he said.

Airbus has 116 firm orders for the A380, close to half the 250 it says will allow it to break even after spending almost $12 billion to develop it. The plane is due in service in 2006.