Airbus now hopes for China aircraft deals after EU shelves carbon tax

EUROPEAN aircraft manufacturer Airbus said it is confident that it will deliver A330s it has sold to China after widespread international outcry against the EU carbon tax forced the EU to suspend the measure, Reuters reported.

Airbus said delayed contracts include the Chinese purchases of 35 long-haul A330s and another 10 expected orders in doubt because of the carbon tax.

"I believe we will deliver those airplanes. We hope we will go back to business as usual, and that we won't have to worry about ETS (Emissions Trading Scheme) when we do business here," said Airbus China president Laurence Barron.

The EU said it will drop plans to force non-EU carriers to comply with its carbon tax for one year after it provoked fierce opposition from China, India and the US.

Objecting nations say the scheme contravenes national sovereignty because it taxes carbon emissions over foreign countries and not just over EU member states or territorial waters. The tax also usurps the UN's International Civil Aviation Organisation that is charged with regulation in this sphere after agreement of member states.

In response to the tax, China blocking US$12 billion of long-haul passenger jet contracts signed by Airbus, causing the manufacturer to halt production, putting the jobs of 1,000 people at risk. Airbus delivers over 20 per cent of its aircraft to China.

Mr Barron declined to comment on doubts over the future of a US$4 billion A380 plane order from Hong Kong Airlines, a unit of the mainland's HNA Group, which also owns Hainan Airlines. Hong Kong Airlines had been ordered to drop Airbus for its long-haul planes. Short haul aircraft contracts continued to go forward unaffected by the carbon tax dispute.

But last week HNA Group, China's fourth-largest aviation group, said the company may cancel the order, citing weak market conditions.