Airbus in Talks With Air Lease on Big Order Including Freighters
Airbus in Talks With Air Lease on Big Order Including Freighters
(Bloomberg) -- Airbus SE is in talks with Air Lease Corp. on a significant aircraft order involving a mix of narrow- and wide-body jets, which could include the European planemaker’s coming A350 freighter, according to people familiar with the matter.
The talks are ongoing and it’s not clear whether an agreement will be reached at this week’s Dubai Airshow, said the people, who asked not to be named with negotiations in flux. Discussions could still fall apart, the people said.
An Airbus representative declined to comment on order chatter at the airshow. An Air Lease representative didn’t immediately respond to requests for comment outside of U.S. business hours.
A top-up deal on narrow-bodies would hand Air Lease firepower to accelerate growth coming out of the Covid-19 downturn. Chief Executive Officer John Plueger said on Nov. 4 that the Los Angeles-based firm has found operators for all its aircraft on order through 2023, and that current talks with customers are focused on jet leases starting from 2026.
Air Lease, one of the world’s biggest aircraft leasing firms, is up against a larger competitor after Ireland’s Aercap Holdings acquired General Electric Co.’s leasing arm. Airlines have become more reliant on financial intermediaries to secure aircraft during the pandemic, after the downturn in air travel weakened their balance sheets.
Stronger Case
Airbus, meanwhile, would score a coup on two fronts, in a year when order activity is expected to be quiet at the show.
The planemaker, based in Toulouse, France, is trying to show that demand is strong enough to ramp up production of its A320 family of single-aisle jets to pre-pandemic levels and beyond.
Sales in Dubai could bolster this argument, after Airbus agreed to restructure an order from Malaysia’s AirAsia X Bhd. and VietJet Aviation PJSC pushed back A320-family deliveries.
Freighter Challenge
Securing customers for the A350F is a key goal for Airbus in Dubai, as it attempts to chip away at archrival Boeing Co.’s supremacy in the freighter market, one area where business has remained brisk during the pandemic.
Air Lease has 117 orders for the popular A321 variant outstanding, and just five of the A320, based on figures posted online by Airbus. There are 50 of the smaller A220s, and 16 A350s yet to be delivered.
Airbus secured board approval for the A350 freighter in July, but hasn’t announced any customers. Firm commitments are the next step in going after Boeing.
Both manufacturers see industry demand for close to 900 new-build cargo jets in the next two decades.
Airbus Commercial Chief Christian Scherer said Saturday that the need for a lower-emission freighter would gird demand for the A350F.
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