Airbus: Iran's Custom Aircraft Deliveries May Be Delayed

The sales director of Airbus has predicted that the aircraft ordered by Iran following the nuclear agreement will be delivered, but their transfer may occur later than planned. Donald Trump, the U.S. President, who has been a serious critic of the nuclear deal between Iran and six world powers since July 2015, recently urged America's European allies to help fix the 'catastrophic flaws' in the JCPOA or Washington will withdraw from the agreement. Airbus and its American rival Boeing have agreed to sell 180 commercial aircraft to Iran to help Tehran rebuild its aging fleet, but the sale of these aircraft is contingent on continued U.S. support for the JCPOA since parts of these planes are made in the U.S. John Lee, Airbus's sales director, stated on Monday, January 15, that 'I believe those contracts will be executed, but they may not happen on time.' Airbus has agreed to sell 100 aircraft to Iran's state airline, Iran Air. Mr. Lee added, 'We have to resolve the financing issue (of the aircraft sales); they (the Iranians) need to consider the down payments.' Iran Air has so far received three Airbus aircraft and several others made by the Italian-French company ATR. Western bankers say that further trade with Iran has stalled due to the caution of Western financial institutions, as they are concerned that the nuclear agreement with Iran may reach a deadlock. Iran's order for 100 aircraft allowed Airbus to surpass its rival Boeing in aircraft sales in 2016. Airbus again outperformed Boeing in this regard in 2017. Airbus has managed to obtain sales licenses for a series of aircraft from the U.S. Treasury Department, which will expire in the early 2020s. This situation means that if the aircraft are to be delivered to Iran late, the licenses issued, which are valid until 2020, must be renewed. If these licenses are not renewed, the number of aircraft delivered to Iran will decrease. On January 7, Asghar Fakhrieh Kashan, the deputy minister of roads and urban development of Iran, stated to ILNA news agency regarding the fate of aviation contracts in the event of the U.S. withdrawal from the JCPOA that any new decision by the U.S. government regarding these contracts 'will not have retroactive effect' and 'cannot affect the licenses that have been issued.' The Airbus sales director, who is set to retire next month, noted that without receiving down payments from Iran, the company will proceed cautiously regarding the construction of aircraft for Tehran. Aviation sources say that Boeing is also holding off on manufacturing custom aircraft for Iran until Iran makes the down payments. Mr. Lee stated, 'Aircraft go into production when you have received down payments, so we will likely pursue this process slower than we thought, but I believe it will happen.' Boeing has also signed a contract to sell 80 commercial aircraft to Iran Air and has committed to selling 30 aircraft to the Aseman Airlines.