Airbus learns from A380 saga - CEO Tom Enders

By Harry Suhartono and Tim Hepher

SINGAPORE (Reuters) - The head of Airbus said he had ordered an internal investigation into how the company allowed wing cracks to develop on its flagship A380 passenger jet as the world's largest planemaker sought to draw a line under weeks of embarrassing publicity.

Chief Executive Tom Enders reiterated the world's largest jetliner was safe to fly as engineers repair hairline cracks in the wings, and sought to allay any concerns the setback to Europe's industrial prestige could spread to the future A350.

"We made a mistake here and we are repairing it as quickly as possible," Enders said at the Singapore Airshow on Wednesday. "This plane is absolutely safe to fly."

"Are we learning from this? Absolutely. We are taking lessons from the A380 programme for the A350 programme," he said, referring to the company's next project, a mid-sized jetliner designed to compete with the Boeing 787 Dreamliner.

"We have a thorough investigation underway on how we could make these mistakes in the first place and to eradicate the sources of the mistakes," he said.

A series of announcements about the cracks, which Airbus and regulators say do not affect parts critical to safety, has embarrassed Airbus and overshadowed Enders' appointment to run parent EADS from June.

After initially underestimating public concern about teething problems on the double-decker plane, Airbus has given detailed briefings on parts and manufacturing errors. An Airbus spokesman said it had given information as it became available.

Enders declined to comment on a German media report that the slip-up could cost Airbus 100 million euros to fix, but acknowledged it was likely to be "a bit of money."

Airbus officials say the cracks affect an average of five out of 2,000 aluminium alloy brackets per wing. Airbus is expected to have to pay for the repairs and airline downtime.

A senior industry official, asking not to be identified, said the cost would be secondary. "Airbus will get this right. It's not about money. It's about credibility and confidence."

Airbus reaffirmed its 2012 delivery target of 30 A380s.

BOEING ALSO HIT

Rival Boeing said this month it found a process called "delamination" on part of the rear fuselage of its carbon-composite 787 Dreamliner, somewhat akin to the cracking on a metal structure, but harder to detect.

Boeing has said it is carrying out inspections and has worked out how to fix the aircraft waiting to be delivered.

The A350 is also being built of carbon materials.

Boeing confirmed a record order for 230 planes from Lion Air, whose founder hit back at questions over whether the Indonesian low-cost carrier could afford them.

"People should understand that they should not look down on somebody in the Third World. Just because we are businessmen from the Third World, doesn't mean we can't afford them," airline Chief Executive Rusdi Kirana told Reuters.

Indonesia's domestic market grows at 20 per cent a year.

Rival Garuda Indonesia will go ahead with a plan to boost its fleet size to 154 aircraft from 89 in three years, despite the threat of overcapacity arising from Lion Air's large order, its chief executive said.

The remarks came as the flag carrier finalized a $1.32 billion deal including 6 Bombardier CRJ1000 regional jets.

Orders were otherwise thin after a flurry at the end of last year. But Airbus unveiled a surprise deal with Singapore's ST Aerospace and EADS EFW of Germany to convert A330 jetliners into cargo planes, giving them a second lease of life hauling goods.

Qatar Airways Chief Executive Akbar Al Baker has criticized Airbus for ignoring this market and is likely to be wooed as a potential buyer.

China and other Asia-Pacific nations will take delivery of 9,370 jetliners over 20 years, valued at $1.3 trillion, helping to power the industry's growth, Airbus said on Wednesday.

(Editing by Matt Driskill and Jodie Ginsberg)