Qatar Airways order could go to Airbus or Boeing

DOHA - Qatar Airways will order 60 aircraft soon but has still not decided whether to choose Airbus' latest twin-aisle A350 jet or a rival offering from Boeing, a source close to the airline said on Thursday.

"No decision has been made yet but Qatar Airways aims to purchase 60 new planes from either Boeing's (787) Dreamliner or Airbus' A350," the source told Reuters. An order of that size would be worth about US$9 billion ($12.8 billion).

Qatar Airways aims to expand its 40-strong fleet to between 110 and 120 aircraft by 2012-2013. It flies only Airbus jets at the moment, and recent media reports have suggested it may be leaning towards the European manufacturer again for the next big contract.

The source said there was still speculation as to how the deal will go but that it was unlikely to be split between Airbus and US rival Boeing.

"It doesn't make business sense to go half Boeing half Airbus because the costs of maintenance for parts and for training staff on different systems would be high."

Discussions were continuing but the deal could still be announced at the Paris air show next week, the source added.

Qatar Airways, one of the fastest-growing airlines in the world, aims to expand its range of destinations to 70 by the end of the year from 65 now.

The tiny Gulf Arab state is building a new airport to allow it to handle 12.5 million passengers annually by 2009, up from 4.2 million now, and further expansion should take capacity to over 50 million by 2015.

Airbus, owned 80 per cent by Franco-German-Spanish company EADS and 20 per cent by BAE Systems Plc, is seeking European state loans to develop the A350 and hopes to secure commitments from airlines at next week's Paris show.

The planemaker needs to win sufficient orders to persuade shareholders to approve funding and construction of the A350, but so far it has garnered less interest than Boeing's 787.

Airbus has lined up 100 commitments for the A350, according to BAE. Boeing said last year it would go ahead with the 787 and has now secured 266 commitments from 21 customers, of which 128 firm orders.

Both twin-engined planes are designed to offer lower operating costs and greater range than current models of their size.

- REUTERS