By Tim Hepher and Victoria Bryan
FARNBOROUGH England (Reuters) - European planemaker Airbus kicked off the Farnborough Airshow on Monday with confirmation it would sell revamped versions of its A330 wide-body jet powered by Rolls-Royce Trent 7000 engines and offering 14 percent fuel savings.
Deliveries of the A330neo will start in the fourth quarter of 2017, Airbus said in a statement, adding it would build A330-800neo and A330-900neo models.
Airbus will incur development costs for the A330neo from 2015 to 2017, with an impact of around 70 basis points on the group's 2015 return-on-sales target, the company said.
Reuters reported on Sunday that Airbus would begin the air show with up to 100 commitments for the A330neo, citing industry sources, stepping up a contest with Boeing for up to $250 billion of orders at the core of the long-haul jet market.
The announcement of the upgraded A330, after months of speculation, is Airbus' attempt to prolong the life of its profitable twin-aisle jet, as the company tries to preserve market share against Boeing's much newer 787 Dreamliner.
"We have a very good business case and the A330neo, once in service, will continue to significantly contribute to our group's earnings," Airbus Group Chief Executive Tom Enders said.
The A330neo will have a range increase of up to 400 nautical miles, with room for up to 10 extra seats in the cabin, Airbus said. The aircraft will also have aerodynamic improvements such as new wing tips, as well as an increased wingspan.
"We see strong market potential for the A330neo, and like its market-leading smaller sister, the A320neo, we are confident this new aircraft will be a success in the medium-haul segment," Airbus division CEO Fabrice Bregier said.
Among Airbus' airline customers, Malaysia's AirAsiaX has campaigned for an A330neo to save on fuel bills but is seen likely to exchange any new order against at least part of its 38 outstanding current-generation A330s.
Hawaiian Airlines said on Friday it was prepared to look at a revamped version of the A330 passenger jet, but indicated it would not take an immediate decision.
(Editing by Louise Heavens and Mark Potter)