Airbus's tussle with Qatar Airways continues as the plane builder cancels another of the airline's jet orders.
Airbus and Qatar Airways' $600 million contractual and safety disagreement intensified Tuesday when the European aircraft manufacturer voided orders for two A350-1000 planes, just days after canceling an order for 50 A321neos from the Gulf carrier.
Airbus and Qatar Airways are locked in a high-stakes legal battle that is closely watched by the industry, as it has the potential to reshape the partnership between manufacturers and airlines.
It began with flaking paint on an Airbus A350. The airline, which is the largest purchaser of Airbus's most advanced model, and which has a list price of more than $300 million, noticed degradation on a plane scheduled to receive a new livery in late 2020.
Airbus suggested that the jet be sent to its headquarters in Toulouse, France, for further examination, despite the fact that the model was deemed safe to fly.
Qatar eventually grounded 21 of its 53 A350s last year after the local regulator revoked their airworthiness certificates and refused to accept new aircraft on order.
In December, the airline filed a lawsuit in London's High Court seeking compensation totaling more than $700 million.
As a response to Qatar's cancellation, Airbus canceled 50 of its popular A321 aircraft and two A350 aircraft - actions Airbus asserts are permissible under contract terms, but Qatar denies this.
Airbus confirmed Tuesday that it has revoked Qatar's order for two A350-1000 aircraft, as tensions over surface paint issues on the carrier's A350 jets continue to escalate.
Reuters first reported the news, which was later confirmed by Airbus to Insider, who stated that it had "notified Qatar's default on two deliveries."
The news comes just weeks after Airbus canceled Qatar's order for 50 A321 aircraft, citing the carrier's $618 million lawsuit against the planemaker in a London High Court following the forced grounding of 21 A350s.
According to Qatar, deteriorating paint on wide-body planes is a concern for aviation safety.
The airline has argued in court that it did not breach its contract by refusing to take two A350s parked on the Toulouse tarmac. Additionally, it contends that Airbus is not entitled to assert a "cross-default" that would allow it to cancel the A321neo deal.
According to an Airbus representative, the company "terminated delivery positions for two A350s for Qatar Airways in accordance with our rights" on Tuesday.
