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Saturday, 24 November 2012

Airbus Updates No.858

Huge China Eastern order for 60 Airbus A320NEOS.

China Eastern Airlines ordered 60 Airbus A320s yesterday in what is the second-biggest order won by the European aeroplane maker for A320 aircraft this year. The deal came 11 days after the European Commission (EC) suspended its controversial emissions trading scheme on flights into and out of Europe until at least next autumn.

The airline, mainland China's second-largest carrier by value, said the order was worth US$5.3 billion at list prices, although the carrier added that it received "substantial price concessions".

Airbus also agreed to buy 18 smaller regional jets from China Eastern, which have a book value of 1.54 billion yuan (HK$1.9 billion), for the aircraft manufacturer to sell or lease to airlines.

The A320s, which typically carry about 150 passengers, will be delivered in phases between 2014 and 2017 when they will be deployed on short- and medium-range domestic services. They will replace the eight Canadair and 10 Embraer regional jets that China Eastern has sold to Airbus.

The airline said the disposal of its entire fleet of 50-seat regional jets will streamline the aircraft types operated by the company as well as optimise its fleet structure and lower operating costs. The regional jets have an average age of 8.2 years.

China Eastern Airlines is the world's largest operator of A320s with 130 aircraft in service and 18 already on order before yesterday's purchase announcement, according to Airbus data.

The airline was among the mainland China carriers which boycotted the EC's emissions trading scheme after the Civil Aviation Administration of China ordered carriers not to participate earlier this year.

The emissions trading scheme would have cost Chinese airlines 790 million yuan had it been applied this year, according to aviation industry estimates, rising to 3.7 billion yuan in 2020.

On November 12, the EC proposed deferring the application of the scheme to flights outside Europe until after a meeting of the International Civil Aviation Organisation (ICAO) general assembly set for autumn 2013. The ICAO is a United Nations body governing global aviation.

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