Airbus adamant no room for more talks in cancelled Japan jet deal

AFP
Skymark Airlines' Airbus A330-300 plane taxis at Tokyo's Haneda airport on July 30, 2014
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Airbus on Thursday said its decision to cancel a $2.2 billion jet order from Skymark Airlines was final, rejecting the Japanese carrier's suggestion that talks were still ongoing.

The European aircraft maker said this week it had informed Skymark that its purchase of six A380 superjumbos "has been terminated", just hours after the airline said it was still locked in tough negotiations.

Skymark's Tokyo-listed shares plunged in the wake of Airbus announcement, wiping out a quarter of its market value -- amounting to about $64 million -- in just two sessions.

"We are still in negotiations," a Skymark spokeswoman said Thursday.

A spokesman for the European firm's Tokyo unit told AFP Thursday: "We will not talk about the issue of the shipment anymore, as we have cancelled the order."

He added that Airbus would now be working on a compensation package over the failed deal, which was signed three years ago.

Skymark had on Tuesday acknowledged that the deal was in trouble as a sharp decline in the yen since late 2012 jacked up the cost of purchasing the jets, while it faced increasingly fierce competition.

The carrier said Airbus had threatened it with "overpriced" fees to cancel -- or slim down -- the order as it suggested the small airline be merged into a bigger carrier, which it flatly rejected.

The carrier's shares closed down 3.24 percent at 209.0 yen Thursday before it announced that its loss in the three months to June had ballooned to 5.80 billion yen ($56 million), four times higher than its shortfall the previous year.

Skymark, which launched in 1998 in a bid to offer more choice in a market long controlled by Japan Airlines and All Nippon Airways, flies dozens of domestic routes with a fleet of 30 aircraft.

However the emergence of a handful of low-cost carriers in recent years has offered up stiff competition to the major carriers, and dented Skymark's finances.

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