UPS denies bid to cut Airbus order

UPS denies bid to cut Airbus order

United Parcel Service Inc. on Monday denied reports that it was seeking to cancel part of a $10 billion order for 90 passenger jets from European aircraft maker Airbus.

A spokesman for the Atlanta-based package delivery company told the Associated Press that UPS planned to abide by the order and the delivery schedule originally agreed to with Airbus.

"Those 90 aircraft are firm," John Flick, a UPS spokesman for international operations, said. "It was a firm order, and we're continuing on schedule."

Flick declined to say whether UPS had earlier sought to cancel or modify any of the orders, after a newspaper reported that it was seeking to cancel 20 A300-600 jets worth over $1.6 billion.

Airbus said Monday it was in talks with United Parcel Service about rescheduling deliveries of some aircraft that are part of an order worth some $10 billion.

The Wall Street Journal originally reported that UPS no longer wanted at least 20 of the 90 Airbus A300s it ordered in 1998 and 2001. The 20 planes are worth more than $1.6 billion and the total order was worth about $10 billion.

The newspaper, citing unidentified people familiar with the situation, said UPS was told that it could cancel no more than 16 planes because some of them are already in production.

According to the same newspaper, Atlanta-based UPS may have to pay hefty penalties for scrapping part of the order, since its contract with Airbus contains no cancellation clause.

The A300s can carry up to 110,000 pounds of cargo and travel up to 2,500 nautical miles. They are used by UPS in the U.S. and in Europe, but not for trams-oceanic flights.