Airbus shares rally after large Chinese order

Air China’s new aircraft Airbus A350 receives a water cannon salute after its maiden flight from Beijing to Shanghai, at Hongqiao International Airport in Shanghai, China on Aug 14, 2018. (Reuters pic)

PARIS: Airbus shares rose on Tuesday after the European planemaker won a deal worth tens of billions of dollars to sell 300 aircraft to China.

Airbus was up 1.9% in early session trading. French officials said the deal was worth some 30 billion euros (US$34 billion) at catalogue prices.

Planemakers usually grant significant discounts.

The Chinese order was announced late on Monday, coinciding with a visit to Europe by Chinese President Xi Jinping and matching a China record held by US rival Boeing.

Investment bank Citigroup kept a “buy” rating on Airbus.

“We do not have details of the delivery schedule of this order, but China has been taking about 20-25% of Airbus production per year and given the A320 family is sold out at announced production rates out to 2024/25, we believe this increases the probability of Airbus moving to a production rate of 70 per month,” wrote Citigroup.