Emirates picks Rolls-Royce engines for 50 A380 aircraft -sources

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By Tim Hepher and Sarah Young

PARIS/LONDON, April 16 (Reuters) - Dubai's Emirates airline has selected British engine-maker Rolls-Royce to supply engines for 50 of the 140 A380 aircraft it has on order with Airbus, two sources familiar with the matter told Reuters.

It is the first time the Gulf carrier has ordered Rolls-Royce engines for its superjumbo fleet, the rest of which is powered by Engine Alliance, a joint venture of General Electric and Pratt & Whitney.

Airbus and Emirates declined to comment on the deal, earlier reported by France's La Tribune newspaper. A spokeswoman for Rolls-Royce said the company did not comment on market rumours.

Emirates is due to make what it has described as a major business announcement in London on Friday, but has declined to say what it will be about.

Though a shift in engine supplier is rare, the deal will not come as a surprise after the airline's president Tim Clark said in March he was considering Rolls-Royce engines for the 50 aircraft for which engine selection had yet to be made.

Industry sources said Emirates' deal with Rolls-Royce was taking longer than expected to conclude, causing some anxieties at Airbus as production milestones loomed for the affected planes which were ordered in 2013.

A380 UPGRADE ON CARDS

The expected engine order comes as Airbus ponders a possible upgrade of the A380 with newer Rolls-Royce engines to improve its efficiency in response to persistent requests from Emirates, the largest customer.

The selection of the Rolls-Royce engines for the last batch of aircraft could also strengthen the prospects of the A380 upgrade going ahead, one industry source suggested.

For Rolls-Royce, there may be the promise of other things to come," the source said.

Airbus has said no decision has been taken on the A380 upgrade and meanwhile continues to market the existing version of the A380 to airlines that sources say include Turkish Airlines.

But many see a decision on the A380 upgrade as a make or break decision for the double-deck jetliner after a period of slow sales.

Both Airbus and Boeing (NYSE: BA - news) face increasing pressure to boost the sales performance of their largest passenger planes, the A380 and the Boeing 747-8 as some airlines abandon the jumbo jet category for smaller planes. (Reporting by Tim Hepher and Sarah Young, additional reporting by Nadia Saleem; Editing by Dominique Vidalon and David Evans)