While program delays are problematic, and this situation has been ongoing, the contract dispute between American Airlines and Zodiac Aerospace now moves to the courts. A settlement is always a possibility.
Zodiac, one of the two world’s largest suppliers of aircraft seats, cabin structures and cabin components, states that American Airlines’ order cancellations took Zodiac by surprise and the two companies are in discussions to possibly resolve the issue.
Despite long-standing reports of American Airlines’ concerns over timely deliveries of aircraft as a result of Zodiac Aerospace’s delays, the airline’s announcement that it would cancel orders and deliveries for Business class seats produced by Zodiac Aerospace, as first reported by the RunwayGirl Network, still came as a surprise to Zodiac, officials say, especially as Zodiac states it made efforts to address these delays in production.
“Zodiac seats US LLC, a Zodiac Aerospace company was informed that American Airlines filed a Petition in the District Court of Tarrant County, Texas, seeking a judicial determination of the contractual situation between them, concerning business class seats, which may lead to the sharing of this activity with another supplier,” the manufacturer states in an official response to reports.
“Zodiac Seats’ legal advisors are reviewing the filing. Meanwhile, the teams are in discussion with American Airlines to assess the possibility of a negotiated issue. Zodiac Seats regrets this situation, especially since the revised delivery agenda established a few months ago, was met.”
For Zodiac Seats, in Gainseville, Texas, the American Airlines decision came as a heavy blow. The manufacturer has had a relationship with American Airlines for decades, even before Zodiac Aerospace purchased the independent manufacturer, Weber. Zodiac Seats is a major employer in the small Texas community an hour’s drive north of Dallas/Fort Worth, where American Airlines Group is headquartered.
When Skift reached out to American to confirm the initial reports, spokeswoman Laura Nebdal said:
“Zodiac has been notified [of the cancellations]. We have decided to terminate deliveries of the Business Suite product for our B787-9 and have cancelled future orders for the B777-200 retrofits. The B787-8 program will remain unchanged and deliver in its entirety with the Zodiac Business Suite. This will include the last three aircraft that deliver in 2017, after we take a break for some B787-9 deliveries.”
However, American confirmed that it has not yet decided on an alternate vendor, an unusual development for such programs when making a decision on components as making custom changes to components imply long lead times.
“We’re still in the process of looking at vendors, but we will choose a company that can deliver a fully lie-flat seat consistent with the experience we’ve promised our customers,” Nebdal said. “We’ll look for someone who can deliver a great product and make our deadline of installing it on the B787-9, which is scheduled for delivery in 2016. There is enough work left on the B777-200 retrofits that we’ll be able to switch seat types without a significant impact to our retrofit schedule.”
That Zodiac states the cancellation is subject to a a legal determination about the contracts makes this situation even more fluid.
A Zodiac Aerospace spokesperson has promised to provide further information which could shed more light on the repercussions to Zodiac and the American Airlines program. We will update.
Photo credit: American Airlines Business Class seats by Zodiac Aerospace. American Airlines