Yemenia May Cancel USD$2 Bln Airbus Order

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Yemen national airline Yemenia threatened on Tuesday to cancel a USD$2 billion deal to buy 10 planes from Airbus unless the planemaker shows "moral and media support" over last week's Indian Ocean crash.

Since the crash of an Airbus A310-300 off the Indian Ocean archipelago of Comoros last week there has been growing uncertainty over whether the order would be fulfilled at a time when many airlines already face severe financial pressures.

"If we do not receive support from the manufacturer, we might reconsider an MoU [Memorandum of Understanding] signed earlier to buy 10 A350 aircraft," Yemenia Chairman Abdul-Khaliq al-Qadi said.

Asked about what kind of support he expected, Qadi said: "Moral and media support after the accident".

The crash, which killed all but one of the 153 people on board, has raised questions about state-controlled Yemenia's safety practices and anger from Comorans living in France.

However, Qadi said: "Yemenia expects support from the manufacturer because its history over more than 40 years manifests its competence."

An Airbus spokesman said the manufacturer had offered all the post-crash support it was required or allowed to offer.

"In all investigations there are strict guidelines (on media communications) that we and everyone have to comply with and we have been applying these rigorously," an Airbus spokesman said.

On the order for future planes, he said, "We are in continuous contact with Yemenia as with all other customers, but the discussions are confidential."

Yemenia placed the order for 10 next-generation Airbus wide-body jets, worth USD$2 billion at list prices, in 2007 to jump start what it hailed as ambitious growth plans.

Qadi reiterated "there was no technical fault in the aircraft" that crashed, and said the media had made a "rushed" judgement about the airline.

The European Union said last week the plane which crashed had sparked an EU inquiry two years ago into Yemenia's safety record. France said it had banned the plane from its soil.

The European Aviation Safety Agency also suspended Yemenia's right to carry out repairs on European Union-based jets in February after it failed inspections, EU authorities said.

Yemen's aviation authority has denied any safety problems with the nation's flag carrier and said its aircraft were always thoroughly maintained.

Industry watchers have noted Yemenia had a valid safety audit certificate from trade body IATA, of which it is a member.

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