Rolls-Royce bags $2.2bn order at Paris Air Show

Rolls-Royce flew the flag for the British contingent on the first day of the Paris Air show yesterday, bagging a $2.2bn (£1.4bn) order with Brazil's TAM Airlines to provide engines for its fleet of Airbus A350 jets.

The deal includes an agreement for services and support over 12 years, and comes after TAM placed an order for 27 A350s with the European plane maker. Rolls-Royce also won a $250m share of an order from China Southern Airlines for engines to power 30 A320s.

Elsewhere, Bodycote signed a 10-year renewal agreement to process metals for Rolls-Royce.

The details were disclosed at the start of the 49th gathering of the aviation industry at Le Bourget airport in Paris. Trade news is set to dominate the first four days of the show, which is held every other year. The public is allowed in for the final three days.

The long-standing rivalry between Airbus and America's Boeing was also in focus as French President Nicolas Sarkozy kicked off the proceedings. The European group was left red- faced even before the official inauguration after one of its A380s had to be to withdrawn from a flying display.

The airliner – the world's largest with a wing span of almost 80 metres – scraped a building at Le Bourget on Sunday and had to be kept out of sight as President Sarkozy opened the show. Adding to the Airbus woes was the fact that, while its star aircraft was being hidden away, Boeing showed off its new 747-8 Intercontinental for the first time outside the US. The 747-8, the largest version of the successful 747 series, touched down in Paris as the company announced orders and commitments for 17 of the new planes. At list prices, the orders, which were placed by two undisclosed customers, add up to $5.4bn.

In other highlights, Boeing bagged an order for six 777-300ER jets worth $1.7bn from Qatar Airways, one of a group of increasingly influential Asian carriers. There was also an agreement with Air Lease Corporation for up to 33 airplanes.

But although Boeing appeared to have the momentum at the start, Airbus shone in the afternoon. Its A320neo – a narrow-body craft whose engines cut fuel costs by 15 per cent, according to the company – was the main draw, with a $5.1bn order for 60 planes from GE Capital Aviation Services. SAS ordered 30 of the new planes, while Air Lease Corporation signed a memorandum of understanding for 50 planes from the A320neo family, including 14 options. Further deals were being eyed after Qatar Airways said it was looking at possible purchases. There was also speculation about a possible 200-plane order from Malaysia's AirAsia.

Beyond the A320neo, Saudi Arabian airlines ordered four Airbus A330-300s. The $890m order follows an earlier deal for eight A330-300s in 2008.

The deals came as Airbus chief operating officer John Leahy indicated that the company would top last year's sales. "I can't make a forecast at this point, but I would say it will be better than last year," he said.

But there was caution expressed by the Brazilian plane maker Embraer, whose commercial aviation head, Paulo Cesar de Souza e Silva, said that Boeing and Airbus could end up by flooding the market in coming years.

"Both of them are expecting to deliver 1,000 jets a year," he said. "That's a lot. If there are disruptions in orders by Malaysia, India, or any global economic problem, it could be bad for the industry as a whole."

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