Airbus made a huge order for 255 narrow-body aircraft at the Dubai Air Show, cementing the European planemaker’s case that demand for planes has begun to dip from the lows of the coronavirus pandemic.
The deal for Airbus’s larger A321 model is worth more than $30 billion (€26 billion) before typical industry discounts. The companies said Sunday that they will be distributed between Wizz Air Holdings and Frontier Group Holdings and two other low-cost carriers of which Bill Franke’s Indigo Partners is the largest shareholder.
Airbus is trying to persuade suppliers to prepare to accelerate production of the tight body after pre-Covid-19 levels over the next few years. However, orders so far in 2021 have been dismal, lagging rival Boeing by two-thirds. At the signing ceremony in Dubai, the CEO of the European aircraft maker, Guillaume Faury, said the IndiGo deal was added to the planned ramp-up plan.
“It gives me great pleasure to be back on top and looking to the future after the Covid crisis,” Faury said.
Airbus is also in talks with Airless for a major order that will include a mix of narrow and wide bodies, Bloomberg reports.
Demonstrating continuous demand is an essential part of Airbus’ mission in Dubai. Market forecasts were released on Saturday showing little change to the 20-year forecast before the pandemic. It is counting on the demand for cleaner planes to drive alternatives earlier than was assumed before 2019.
Airbus said the majority of plans ordered by Indigo would be made in Mobile, Alabama.
Sales chief Christian Scherer said Sunday he needs more planes and would like to see a faster increase from the current goal of 65 A320s per month by the summer of 2023. He said suppliers can deliver.
Frank, who was also based in Dubai, said he had an optimistic view of the market and wanted to be early in the process. Indigo will occupy some of the slots that opened when other customers canceled orders, but the bulk of deliveries will take place from 2025 onwards.
Wizz Air Holdings, the European low-cost carrier targeting market expansion during the travel boom, will take the largest share with 102 aircraft, including 27 longer-range XLR aircraft, according to an Airbus statement.
Bloomberg reported in September that the company was considering a commitment in this area.
Budapest-based Wizz Air is still expanding into central Europe, while adding flights in places like Italy, Austria and the United Kingdom as weaker competitors decline. It also started a project in Abu Dhabi during the crisis, and is looking to grow there.
CEO Joseph Faraday said in an interview that the company still needed more planes in the short term, but that it had some options, including extending existing leases by several years to fill the gap.
“I am completely satisfied that we have the tools that enable us to provide not only the long-term but also the short-term fleet requirements,” he said.
Varaday added that the XLR, which will begin deliveries in the second half of 2023, will allow Wizz to potentially reach Dubai or Abu Dhabi from London.
Frontier plans to take delivery of 91 aircraft between 2023 and 2029, when its fleet will reach 272 aircraft, including those already ordered.
The Denver-based airline has done an initial public offering during the pandemic and has been aggressive in chasing recreational traffic as it bounces. CEO Barry Bevel said that despite the difficulties some competitors face, Frontier has the pilots it needs to operate the aircraft.
Mexico’s Volaris Aviation Holding has ordered 39 planes while JetSmart Airlines has acquired 23 planes, including two XLR planes. It will upgrade 38 existing A320neo orders to A321s.
In all, Indigo Partners airlines have now ordered 1,145 aircraft of the A320 family.
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