(Adds company comment, background)
TOKYO Jan 5 All Nippon Airways (9202.T), Japan's
second-biggest airline, will scrap plans to buy the Airbus A380,
as it and bigger rival Japan Airlines 9205.T slash capital
spending amid weakening passenger demand, the Yomiuri newspaper
The global economic downturn has been hitting airlines as
fewer people travel for business and vacation, forcing carriers
to review capital spending plans and ditch less profitable
The paper, without citing sources, said on Monday that ANA
would cut capital spending by 100 billion yen to 200 billion yen
($1.09 billion to $2.18 billion) from a planned 900 billion yen
in the four years to March 2012.
ANA, which has been considering adding the Airbus A380,
Boeing's (BA.N) 747-8 and others to its fleet from fiscal 2012,
said that while it has postponed choosing new aircraft, it has
not decided to shelve its plans.
"As we said in December, the decision has been postponed and
not scrapped," said ANA spokesman Rob Henderson, adding that the
evaluation process would remain on hold until business conditions
become more favourable.
Meanwhile, ANA spokeswoman Nana Kon said the company had no
comment about the change in its capital spending plans as
reported in the Yomiuri.
ANA is reviewing its business plans and aims to announce
them, including a possible change in its capital spending budget,
by early February, Kon said.
Shares of ANA fell 0.9 percent to 351 yen on Monday, against
a 2.1 percent jump in the benchmark Nikkei 225 index .N225.
The economic slump has taken a toll on the airline industry,
with industry body IATA saying last week that international
airlines saw a huge 13.5 percent fall in cargo traffic in
November and a 4.6 percent drop in passengers. [ID:nLU83911]
Japan Airlines (JAL), Asia's largest carrier, said last month
that it may slash its capital spending budget for the three years
to March 2011 by nearly a quarter, prompted by falling demand for
international flights. [ID:nT292202]
ANA, meanwhile, cut its full-year operating profit forecast
by about one-third in October, saying business conditions were
likely to get tougher in the latter half of the business year.
An Airbus sale in Japan would be a big breakthrough for the
European plane maker, a unit of European aerospace group EADS
EAD.PA, as it has only about 4 percent of the Japanese market,
compared with a 50 percent share elsewhere.
The Nikkei business daily had reported in July that Airbus
would sell five A380 superjumbo aircraft to ANA, its first sale
of the world's biggest passenger plane to a Japanese airline.
ANA is also set to be the first carrier to fly Boeing's B787
Dreamliner, a new fuel-efficient jet that can carry about 800
But Boeing last month announced a fourth delay to the
delivery of the troubled aircraft because of a strike by
machinists and problems with wrongly installed bolts on the first
batch of planes.
(Additional reporting by Sachi Izumi; Editing by Chris