Iran faces financial hurdles for Airbus orders

Concerns in the financial community about doing deals in Iran are hampering Airbus Group’s ability to close a multibillion-dollar aircraft deal with Tehran, the European plane maker’s head of sales said Wednesday. “We have to find ways to get money out of Iran through the banking system,” said John Leahy, Airbus COO for customers. While progress has been made, it has been slower than expected, Leahy said. Banks remain reluctant to do deals now that the US and European governments are looking to foster transactions, after facing fines imposed by US regulators on lenders with Iran dealings when western sanctions were in place. “They are all very shy,” Leahy said. Iran, with a population of more than 80 million and pent-up demand for travel after years of isolation, represents one of the few large remaining untapped markets for new planes. Leahy said Iran has “an ancient fleet” that needs replacing and will enjoy growth as the country’s economy recovers. IranAir CE Farhad Parvaresh acknowledged that the banking issue is one of the biggest hurdles to closing plane deals. The banking issue goes beyond the airplane sector. Oil companies also have struggled to line up big banks to back deals. They have, in some cases, had to resort to barter arrangements or using smaller banks.<br/>