DOHA (AFP) – Qatar Airways and Airbus announced on Wednesday the end of a USD2.5 billion dollar battle over peeling paint on passenger jets before it became an embarrassing court case.
After months of negotiations and talks between French and Qatari leaders, the two sides said they were “pleased to have reached an amicable and mutually agreeable settlement” over the surface degradation that forced the grounding of 29 A350 jets.
Experts said neither side wanted a prolonged court case.
Qatar Airways needs jets for its expansion plans while Airbus could not afford to alienate one of its most important customers.
Qatar Airways had sought about USD2.5 billion in damages and penalties before a British court where the case was due to be heard from June. “A repair project is now underway and both parties look forward to getting these aircraft safely back in the air,” they said in a statement.
The European jet builder and the fast-growing Gulf airline said that the details of their accord would remain “confidential” and that “the settlement agreement is not an admission of liability for either party”.
“This agreement will enable Qatar Airways and Airbus to move forward and work together as partners,” they added.
Qatar grounded the jets in 2021 after paint started peeling on the exterior of some of its long-haul wide-body A350 planes. Its regulator said there could be a threat to the jet’s lightning protection.
While Airbus acknowledged the paint problem, the company and the European Aviation Safety Agency (EASA) said there was no threat to airworthiness.
Qatar Airways launched a legal battle and refused to take deliveries of more of the models.
In retaliation, Airbus cancelled the sale of 19 A350 jets and 50 A321 medium-haul planes.
An Airbus spokesman told AFP the latest agreement meant that the orders, worth more than USD14 billion at list prices, had been re-established.
“This is obviously a beneficial outcome for both parties,” said Director of Aerospace and Defence Analysis at the AIR consultancy Michel Merluzeau.
He said it would be difficult for Qatar Airways “to decide that they don’t want to trade with Airbus”, particularly with high profile problems at its United States (US) rival Boeing.
The state-owned airline has launched a multibillion-dollar expansion of its operations and its Hamad International Airport base.
“It would mean postponing new routes, and the A321-neo is integral to Qatar Airways’ planning for new routes from Doha,” Merluzeau said. “Airbus could not afford to alienate an important client like Qatar Airways.”
While the pain was a “significant concern” for Qatar Airways, he added, the aviation industry in general felt that “it was not a particular safety-of-flight issue”.
Qatar Airways and Airbus started serious reconciliation talks last year, and in October the plane maker held a breakthrough technical meeting with the Qatari regulator.
The settlement was discussed when France’s Finance Minister Bruno Le Maire met with Qatar’s emir Sheikh Tamim bin Hamad Al-Thani in Doha last Sunday, a source said.
“It is the result of important joint efforts. It is excellent news for the French aviation industry,” Le Maire said as he welcomed the end of the dogfight.