American Airlines’ acquisition in Airbus’ favour

BOEING aircraft favourite American Airlines (AA) is in active negotiations with European manufacturer Airbus as the carrier looks to replace 38 per cent of its current fleet.

AA, presently an all-Boeing operator, is interested in both Airbus’ single-aisle family of A320s and a A320-neo (new engine option), which will begin flying in 2015.

The airline’s purchase order of an estimated 250 aircraft, amounting to around US$15 billion, would be significant to both parties but more so Airbus, which has faced closed doors in the US.

AA and Delta Air Lines flew early Airbus models, but retired them in favour of Boeing aircraft. US Airways Group is Airbus’s biggest US customer and Southwest Airlines is the only other major US carrier not to fly any Airbus jets.

AA, the US’ third largest operator, entered discussions with Airbus earlier in the year and later approached Boeing for a counter offer, sources said.

American is evaluating Boeing’s 737 family, which include the 737-700 and 737-900, types that are not currently in AA’s fleet. The airline has 152 737-800s in its fleet and 54 more slated to enter its fleet by 2013. In addition the carrier has more 777s on order and is a customer of the problem-hit 787 Dreamliner.

A purchase, which the airline hopes to finalise this summer, would replace AA’s 220 MD-80s and some 757s. The airline has reduced its number of aircraft variants to five from 14 in the early 1990s to boost efficiency and cut training and spare-parts expenses.

However it is unclear whether either manufacturer alone can meet the airline’s goals given the short five-year time frame and existing orders on the manufacturers’ books from other players.

Airbus is attempting to sweeten the deal by offering American significant discounts, creative financing terms and assistance with training pilots and mechanics, stocking spare parts and handling the fleet transition.

The A320neo’s success is increasing pressure on Boeing to reveal future plans for the stalwart 737 model, whose engines Boeing has already updated twice. Company executives have said they plan to decide by year’s end whether to update its engines again or develop an entirely new model.

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