Airbus orderbook variations: 100 planes in, 50 out?
It is an interesting week for Airbus. Two days after the plane maker announced signing a deal for 100 aircraft, another company’s client, already holding same size deal, opened up about having second thoughts.
Back in 2015, Avianca signed an order for 100 Airbus A320neo Family aircraft. At the time, it was the largest single order ever made in Latin America’s aviation history. But now, the company’s CEO opened up about plans to notably downscale the deal to 50-80 planes only.
On December 9, 2018, Avianca Holdings CEO Hernan Rincon said the company is looking to cut the deal with Airbus by half, keeping around 50 aircraft of the 100 A319neo, A320neo and A321neo aircraft currently on order. “We don’t have any doubt that we will keep growing, what has changed is the rhythm of the growth,” Rincon is quoted as saying by Reuters.
The main reason given for the decision – the change of technological advancement pace. “The rhythm of technology is changing, it will take a while to get all of the order and we don’t want to have a commitment to planes with today’s technology which will be received by us in 10 or 15 years,” Rincon explained.
However, an aircraft order, especially the one that involves 100 planes, is also a serious financial commitment. Rincon admits that this another part of reasoning behind the decision to cut the deal.
Avianca Holding is the second largest airline holding company in Latin America. It has partnered with Airbus on its fleet modernization and expansion programs for years. In 2012, Avianca ordered 51 A320 Family aircraft, including 33 A320neo aircraft.
Across its subsidiaries, the Latin American holding currently has a fleet of 224 aircraft and only 38 of them are non-Airbus. Its biggest airline, also named Avianca (based in Colombia) operates a fleet of 104 aircraft, of which 82 are Airbus, including A320neo and A321neo types.
The news about Avianca’s second thoughts comes just days after Airbus announced signing equally voluminous deal with a leasing company from Dublin. On December 7, 2018, the French manufacturer released a statement, announcing that Avolon signed a firm agreement for 75 A320neos and 25 A321neos. In total, the lessor now has 284 Airbus aircraft on order and is the biggest Airbus’ client among leasing companies.
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