Airbus Wins $14.2M in Dispute with Hawker Beech

 - May 5, 2011, 10:20 AM

Hawker Beechcraft (HBC) will have to pay $14.2 million to close a two-year-old dispute with Airbus, which manufactures Hawker business jet airframe components for Wichita-based HBC. On April 29, an arbitrator–the International Chamber of Commerce–imposed the award for damages relating to HBC’s purchase volume obligations for fuselages, wings, track kits and spare parts under an airframe purchase and support agreement. The European aircraft manufacturer requested arbitration in May 2009, alleging “that [HBC] breached its obligations under the airframe purchase and support agreement dated Aug. 19, 1998.” According to SEC filings, Airbus claimed that the two companies agreed in April 2008 for HBC “to purchase increased volumes of fuselages, wings, track kits and spare parts in the 2008 to 2010 time frame.” Airbus said it invested substantially to “expand its production capacity” to meet the demand from Hawker Beechcraft, but that HBC in early 2009 “unilaterally reduced the number of shipsets that it would purchase in breach of its contractual obligations.” Airbus was seeking damages of more than $60 million from HBC.