Airbus has lost a keenly fought contest with Boeing to sell wide-body jets to American Airlines (A1G) (AAL) , the plane maker says. Boeing is now set to supply its 787 Dreamliner to the U.S. carrier, beating Airbus pitch of A330neos. It is the latest blow to the European plane maker’s efforts to boost the sluggish A330neo sales.

Discussions with American on the re-engined model of the European plane maker’s smallest wide-body jet have ended, Airbus told Bloomberg on March 23, 2018, reportedly saying it was unwilling to match the price Boeing offered.

“In this case, the competition simply priced their aircraft lower than we were willing to offer,” Airbus said in a statement. “We look forward to the next opportunity to compete with what we know is a superior product.”

American says it has not made any final decisions on the aircraft order. “We are continuing to look at our wide-body options and are focused on making the right decision for American,” the airline’s spokesman stated.

Although not yet finalized, the deal is also a win for General Electric, as its engines are expected to power the Boeing aircraft, beating proposals from rival Rolls-Royce, Reuters reports.

The U.S. carrier said in January 2018, it was considering the A330-900neo and Boeing 787-9 Dreamliner as a possible substitute for a long forsaken deal for 22 of A350-900 twin-aisle aircraft. The A350s themselves were to be a replacement for the carrier’s Boeing 767s and 777s that it is phasing out.

American inherited the A350 deal from U.S. Airways when it merged with the smaller carrier in 2013, but had put off delivery twice already, in 2016 and 2017. According to the airline’s president, Robert Isom, the small fleet of 22 aircraft was not suitable for an airline of its size and the carrier would not be able to profitably operate the modest number of jets. Meanwhile, Boeing’s Dreamliner does “many of the same missions” as the 767s and 777s that are being phased out, Bloomberg explains.

In recent years, American has renewed its fleet with hundreds of new aircraft. According to industry sources, the airline is currently looking for about 25-30 wide-body jets, which would make a deal with Boeing potentially worth around $7-8.5 billion, Reuters writes.

The Fort Worth, Texas-based carrier received its first Boeing 737 MAX in 2017, and currently has 16 of them scheduled for delivery in 2018, with another 20 expected in 2019. Six of the 787 Family jets are set to be delivered in 2018, and two more in 2019, according to American’s fleet data.

American is the world’s largest airline by fleet size, with 951 aircraft currently in its mainline fleet. The airline also has the youngest fleet of the U.S. global network carriers, with an average mainline fleet age of just over 10 years.

Second-guessing the A330neo

Airbus updated its A330 series in 2014 with new Rolls-Royce Trent 7000 engines, but after an initial foray, the model has been struggling in the marketplace. The recently appointed Airbus sales chief Eric Schulz has made boosting sales of the aircraft a top priority for 2018, Reuters writes.

The latest setback comes weeks after Hawaiian Airlines dropped an order for six Airbus A330-800neos in favor of ten Boeing‘s 787, leaving that particular long-haul A330neo model with no customers. Airbus is reportedly even considering a cargo model of the A330neo, which would also compete with Boeing – the leader in the global air cargo industry – and its popular 767 freighter.

READ MORE:
 
Airbus is considering building a freighter version of its A330neo wide-body jet, after receiving requests from potential customers Amazon.com and UPS.
 

According to Reuters, analysts had predicted that American’s decision over the orders would be important for the future of the A330neo program, ether spurring further sales or unleashing new defections. The decision should worry the European plane maker as it now needs to prevent the A330neo’s main buyer AirAsia X, changing its mind after announcing an order of 66 aircraft back in December 2014.