Airbus secures mega order for 292 aircraft in China

Although air traffic in China has been paralyzed by the pandemic, the need remains immense: Four Chinese airlines announced on Friday that they have placed a mega order with Airbus for 292 single-aisle aircraft from the A320 family.

The orders for Air China, China Eastern, China Southern and Shenzhen Airlines total almost $37 billion (35.6 billion Swiss francs) at a rarely used catalog price.

For Airbus, these pending orders show “the positive recovery momentum and prosperous prospects of the Chinese aviation market.”

China Eastern will acquire 100 A320neo Family aircraft and China Southern 96 of the same model. Air China and its subsidiary Shenzhen Airlines will acquire 64 and 32 A320neo respectively.

The companies did not name the A320 Family models affected, but according to a source familiar with the matter, both A320s and A321s can carry more passengers, as well as some smaller A319s.

All deliveries are scheduled between 2023 and 2027, which seems to indicate the contract has been long-negotiated as Airbus is running out of available delivery slots amid significant demand for its single-aisle aircraft.

Though weakened by the pandemic, airlines around the world are trying to prepare for growth in global traffic, which is expected to double over the next 20 years compared to 2019. To do this, they are preparing to extensively renew their fleets with more modern aircraft that consume less fuel and thus produce fewer CO2 emissions.

And if China’s air travel remains stunted by the country’s heavy health restrictions, it’s likely to explode in the years to come. According to Airbus forecasts, the aircraft fleet in China is set to triple to almost 11,000 aircraft by 2040.

At the end of May, the European aircraft manufacturer’s order book contained more than 8,000 orders for aircraft from the A320 family.

increase in cadences

Asked a few months ago about the lack of Chinese orders for several years despite the prospects for long-term growth, Airbus CEO Guillaume Faury was confident.

“It will be necessary to renew this order book for airlines to regain their visibility,” he told some journalists.

The mega-order also underscores the European planemaker’s ambition to ramp up production rates to 75 A320s per month by 2025, according to a source familiar with the matter.

Some suppliers, above all the engine manufacturer Safran, have expressed doubts about the usefulness of such tariffs due to the investments required and the expected long-term demand.

Airbus had drastically reduced its production during the pandemic and began phasing in production at the end of 2021 at 45 A320 family aircraft per month, sometimes struggling to recruit.

This order comes at a time when China has yet to certify its national planemaker Comac’s twin-engine C919, which is designed to compete with the Airbus 320 and Boeing 737 MAX. According to Comac, 815 units of the device were ordered by Chinese companies.

A few days before the Farnborough International Air Show (UK), a traditional opportunity for aircraft manufacturers to announce this type of order, it is also a setback for Boeing and its 737 MAX, which Beijing has considered airworthy since December.

The American aircraft manufacturer is banking on the huge Chinese domestic market to find color with its single-aisle competitor to the A320. The four companies that announced the Airbus order on Friday are already MAX customers.

/ATS


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