A monthly report by European plane manufacturer Airbus has confirmed the cancellation of 63 A330neo orders by AirAsia X, comprising a fifth of outstanding orders.

AirAsia X is the largest customer for the A330-900, though post-pandemic restructuring has led the carrier to drop its orders to just 15. Per the report, AirAsia X canceled 10 A321neo aircraft as well.

The cancellation is a significant setback for the A330neo program, which saw another cancellation for 40 A330-900s orders placed by an undisclosed carrier in February, alleged to be HNA Group.

Boeing is set to issue its Q1 data next week.

AirAsia A330
Photo: Getty Images

AirAsia X cancellations

A potential cancellation has been rumored since the start of the pandemic, with AirAsia X seeing a sharp drop in demand brought on by lockdowns across Asia. Its subsequent post-covid restructuring into a streamlined, smaller airline included plans to pay off 0.5% of its $8 billion debt and reduce its liabilities by $5.2 million.

The A330neo is an upgrade of Airbus’ most-sold widebody aircraft, built to compete with Boeing’s 787 and 777. The jet has faced patchy demand, leaving it dependent on AirAsia X’s orders.

Speaking to Reuters, Agency Partners analyst Sash Tusa said,

"It is always a shock to see a large wide-body cancellation but these aircraft have probably not been counted in investors’ delivery forecasts for at least the past three years. With the focus on strong demand for the A321neo, it is a good opportunity to take a look at the A330neo orders and clean up the backlog."

Airbus has started reducing the presence of unlikely completed orders while focusing its attention on the growing sales of its popular A321neo.

Airbus’ current A330neo backlog stands at 200, though it still includes a collapsed Iran Air order for 28 A330-900s.

Airbus A330neo
Despite its initial popularity, the A330neo has struggled to maintain its orders. Photo: Airbus

Growth elsewhere

However, it is not all doom and gloom for the aircraft manufacturer, seeing over 100 new orders for its A320neo range through March. Within the first quarter, Airbus sold 253 aircraft, with a net total of 83 cancellations.

Stay informed: Sign up for our daily and weekly aviation news digests.

Airbus Chief Executive Officer Guillaume Faury told Frankfurter Allgemeine that it hopes to increase production of its narrowbody range to 65 by summer 2023 while seeing stronger demand for a further increase. Faury noted Airbus intends to stick to its 2022 forecast of €5.5 billion in operating profit, increasing its orders by 20% from 2021.

Faury also addressed concerns regarding the impact the Russian invasion of Ukraine has had on the aviation industry, adding,

“The war does not change the fact that people want to travel again and will do so as quarantines, immigration controls and insecurity disappear. However, the supply chains are a major challenge and we are working more closely than ever with suppliers.”

Airbus retains a surplus of A350 aircraft, including two canceled Aeroflot orders and three Qatar Airways has refused to take delivery for. Reuters has reported that Airbus has since approached Air India for a sale of the completed aircraft.

What do you think of AirAsia X's cancellation? What does the future look like for the A330neo program? Let us know in the comments.

Sources: Reuters, Frankfurter Allegemeine