Analysis and discussion of issues that impact business

Add fuel economy issues to the growing list of reasons Airbus is losing ground to Boeing.

In a blow to Airbus SAS, German airline Lufthansa AG said Wednesday it would order 20 Boeing 747-8 planes, with an option for 20 more, becoming the first passenger airline to order the new long-haul jet.

Industry speculators are saying this bodes well for the US aircraft maker.

There is more than a little irony in this story.

The Cologne-based airline said it would start taking delivery of the wide body planes, the longest in the world, in 2010 as it expands into North America and Asia. 

The move was even more striking considering that the parent company of Airbus, EADS, is a joint Franco-German operation.

Whoops.

“Lufthansa is noted for its careful aircraft selection. It must have been somewhat difficult to have made the decision that they did, given Germany’s interest in Airbus,” said Paul Nisbet, an analyst for Rhode Island-based JSA Research. “But they did it and I think all the major airlines will take notice.

I wonder if the issue of "outsourcing" is on the lips of Deutschlanders these days? I'm pretty sure Seattle's all atwitter, though.

The superjumbo’s overall two-year delay wiped about $6.39 billion from profit forecasts over four years and has forced Airbus to consider basing assembly work on new models at a single site, rather than splitting it among several countries.

That's a huge blow for Airbus. I wonder what the true long-term effect it will have on their company. The long and short-term effect on Boeing could be enormous.

For Boeing, the order represents a vote of confidence and could cause other major European flag carriers, such as British Airways and Scandinavian Airline System to consider the new 747-8.

This could be a watershed moment. For both companies.