Thursday, November 20, 2014

Airbus Wins 50 Widebody Jet Deal With Delta Air Lines: Delta to Purchase 25 A350, 25 A330neo Jets For $14.3 Billion at List Prices

The Wall Street Journal
By Jon Ostrower
Updated Nov. 19, 2014 6:53 p.m. ET


Airbus Group NV won a deal from Delta Air Lines Inc. for 50 twin-aisle jetliners, according to a person familiar with the agreement, a big victory for the European company in its battle with Boeing Co. to sell long-range passenger aircraft.

The No. 3 U.S. airline by traffic is ordering 25 long-range A350-900s and 25 A330-900neo jets, the person said. The deal would be valued around $14.3 billion at list prices, not including steep discounts the manufacturers regularly give to airlines.

The deal gives significant market traction to the A330-900neo, a new version of Airbus’s A330 jet with new-generation Rolls Royce Holdings PLC engines. The jet was launched with its first orders in July, aimed at extending the production life of the twin-aisle A330, which has been in service since 1994. The jet touts up to 14% improvement in fuel efficiency over today’s A330.

Delta set off the fiercely-contested sales campaign in April when it announced that it was seeking 50 long-range jets to replace its aging fleet of Boeing 767-300ER and jumbo 747-400s jetliners. The fight pitted the A350 and A330 against Boeing’s 777 and 787-9 Dreamliner. The Atlanta-based airline still holds orders for 18 787s purchased in 2005 by Northwest Airlines before its merger with Delta, but deferred that commitment to 2020 after delays hit the program.

In October, Delta executives said they were working diligently to evaluate Boeing and Airbus options and engine selections from General Electric Co. and Rolls-Royce. A Delta spokeswoman on Wednesday said the company doesn’t have anything to announce related to its request for proposals.

Delta already operates 11 A330-200s and 21 A330-300s. It is in the process of retiring its largest plane, the 747-400s, having already parked 4 of the 13 and intending to put down the rest by 2017. It currently uses the 747s on the Pacific routes. But as it builds up a new hub and Asia gateway in Seattle, Delta is moving some smaller twin-aisled planes to that city for service to Asia.

The Delta order from Airbus was reported earlier on Wednesday by industry blog Leeham News and Comment

—Susan Carey contributed to this article.

- Source: http://online.wsj.com

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