Airbus to sign deal with Delta for 50 planes

November 20, 2014

, PARIS, November 20- European aerospace giant Airbus is poised to sign a deal to deliver 50 long-haul carriers to US Delta Airlines in a contract worth $14 billion (11 billion euros) at catalogue prices, sources told AFP on Thursday.

Under the terms of the deal, Airbus will deliver 25 A350-900s, the company’s new long haul carrier that this month received certification from the US Federal Aviation Authority and is due to enter service by the end of the year, a source close to the negotiations said on condition of anonymity.

The other 25 planes will be A330-neos, an updated version of its wide-body medium-haul jet with fuel saving engines which is slated to enter into service at the end of 2017.

“The order should be finalised in the coming days,” said one of the sources. “The announcement could be made at the beginning of next week.”

Delta had asked Airbus and Boeing in April to submit offers as the airline considers replacing its ageing fleet of long haul 747-400 and 767-300 jets, saying it expected to place an order by the end of the year.

The A350-900 is designed to compete with Boeing 777 and 787 jets in the lucrative long-haul segment and has already received 750 orders.

Equipped with Trent XWB engines from Rolls-Royce, the plane can transport 315 passengers up to 14,500 kilometres (9,000 miles).

Delta already has a sizable fleet of Airbus aircraft, with 126 single-aisle medium-haul A320s and 32 A330s. It has recently orders for another 55 Airbus planes.

– Rush for fuel savings –

Aerospace analyst Christophe Menard said that Airbus likely benefitted from the fact that it could deliver A350s rather quickly after Emirates cancelled in June an order for 70 of the aircraft.

“Boeing, on the contrary, doesn’t have quick slots available for its 787,” he said.

Westhouse Securities said in a note to investors that the order indicates that delivery date is becoming a crucial factor for airlines.

Airlines are in a major push to modernise their fleets to reap the fuel savings that the latest generation of engines offer, especially as competition in the sector is fierce and fuel is one of biggest costs.

Delta’s fleet is on average 17 years old.

Menard noted Delta was one of the airlines which had been encouraging Airbus to offer a version of the A330 with new engines.

“This order would therefore be logical,” he said.

The order, if confirmed, would be the second major deal this month for Airbus.

Earlier in the month, Airbus announced that it had signed a preliminary deal to supply the China Aircraft Leasing Company with 100 planes in a contract worth around $10.2 billion (8.1 billion euros) at catalogue prices.

The orders will help Airbus narrow Boeing’s lead in new orders for this year as the US manufacturer has not announced any major new contracts this month.

At the end of October Boeing had 1,046 net new aircraft orders for this year against 794 for Airbus.

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