NYTimes.com Article: Airbus Plays Down Payment Delay

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Airbus Plays Down Payment Delay

March 4, 2003
By REUTERS






Filed at 8:33 a.m. ET

PARIS (Reuters) - European plane maker Airbus SAS said on
Tuesday that its exposure to bankrupt U.S. airline US
Airways was unchanged following news the carrier had not
made payments of $44.5 million related to 23 Airbus
aircraft.

Airbus also said that financing of the 23 planes had been
shared between a number of different parties, meaning that
its hypothetical exposure to the money owed by US Airways
was limited to 15 percent of the total amount.

``These payments are to be recovered as part of the
reorganization of the airline, currently under Chapter 11
proceedings,'' Airbus said. ``As a result, Airbus does not
envisage changing its assessment of its financing exposure
to US Airways.''

US Airways Inc. said on Monday it did not make certain
payments due on trust certificates related to the Airbus
planes.

The company said it was in discussions with interested
parties regarding the payments and expected to reach an
agreement during the five-business-day cure period allowed
under the certificates.

The news sent shares in Airbus parent EADS down sharply. At
1315 GMT, they stood 7.4 percent lower at 7.50 euros.

Analysts, however, took the news in their stride.

``It's
not a new problem and it's a problem under control,'' one
sector analyst said, adding that Airbus was not scheduled
to deliver any planes to US Airways this year or next.

But traders said the news underscored the difficulty of
aircraft makers that face a grim 2003 due to global
economic weakness and fears tied to the Iraq crisis.

``This is one more bit of negative news in a sector where
visibility is nil because of the economic slowdown and
geopolitical fears,'' said one trader.

EADS shares are down 23 percent this year and hovering just
above an all-time low of 7.25 euros hit late last month.
The stock fell 30 percent last year amid soft demand for
commercial jets.

http://www.nytimes.com/reuters/business/business-transport-airbus-usairways.html?ex=1047786393&ei=1&en=01aa6b4c1ffb7a09



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