Dublin: Qatar Airways has cancelled its first Airbus A320neo and is willing to walk away from a further four after reaching an “impasse” with the European plane maker, group chief executive Akbar Al Baker said on Friday.

The Middle East’s second biggest airline has refused to take delivery of the latest version of Airbus’ best selling single aisle jet since late last year. Qatar Airways says the jet and Pratt & Whitney-made engine do not meet its contractual performance obligations.

“We will walk away from subsequent aircraft if the matter is not resolved,” Al Baker told reporters in Dublin for the International Air Transport Association (IATA) annual meet.

It would represent a significant blow for Airbus and confidence in the A320neo programme if Qatar Airways continues to walk away from its delivers.

Five A320neos are worth $536.5 million (Dh1.97 billion) at current list prices.

Al Baker said in April he was considering cancelling the entire order of up to 80 Airbus A320neos worth $6.4 billion and on Friday said he had opened discussions with rival plane maker Boeing.

“It is making a huge impact on my bottom line,” he said, adding that he had met with Airbus’ plane making unit chief executive Fabrice Brégier on Thursday to “iron out the issues.”

“They have given us a timeline and we hope that they will deliver on those timelines,” he said.

Bregier told Gulf News later on Friday that he was confident of resolving the issues and increasing production in the second half to meet delivery commitments. He declined to comment when asked if he was concerned Qatar Airways could walk away from the entire order.

Al Baker said Qatar Airways would prefer to stick with the A320neos and that he would open talks with rival engine maker CFM International “imminently.’

Pratt & Whitney later labelled Al Baker’s comments as “completely inaccurate”, which makes the engine on the A320neo.

The “engine is fully certified and meets performance and contract specifications,” it said in a statement.

Asked if the performance issues had damaged Qatar Airway’s long-standing relationship with Airbus, Al Baker it was “deteriorating” on a “working level”.

The issues with Qatar Airways could also have further ramifications for other Airbus customers. Al Baker said he would share information with British Airways parent International Airlines Group (IAG), which has an order for 20 A320neos but has yet to announce which engine it will choose. Qatar Airways owns 15.01 per cent of IAG.

Qatar Airways is also facing delays on deliveries of the A350-900, a long-range aircraft competing with Boeing’s 787 Dreamliner and larger 777.

Three A350s deliveries have been delayed so far, Al Baker said, due to a “big disconnect between our delivery team our production oversight team and Airbus team.”

Airbus is contractually obliged to deliver “nearly ten” A350s to Qatar Airways this year and “we will demand those contractual obligations are fulfilled,” he said.

The A350 delays have caused disruptions to Qatar Airways’ network with the airline pushing back the launch of Doha-Auckland flights to early next year and scaling back frequencies on the Doha-Adelaide route due to fleet requirements.

Al Baker said he expects the A350 issues will be resolved before those associated with the A320neos and that an A350 will be delivered “imminently.” It has taken delivery of at least eight of the jets.

IAG investment

Qatar Airways is happy with its 15.01 per cent stake in British Airways parent company International Airlines Group (IAG) and is not pushing for a board seat, Al Baker also said.

Qatar Airways increased its holding in IAG to 15.01 per cent last month. In April, Al Baker said he had upped the stake to close to 12 per cent.

“It’s a strategic investment,” he said on Friday, adding that Qatar Airways and IAG would explore joint purchases, component repairs and catering programmes.

Meridana

Meridiana and its unions have until August to decide whether to accept Qatar Airways’ conditions to take a minority stake that would guarantee the loss-making Italian carrier’s future.

A June deadline on the negotiations could be extended by “one or two” months, Al Baker said.