Asian low-cost carriers boost Airbus coffers

Asian low-cost carriers boost Airbus coffers

Two Asian airlines have placed orders for a total of more than 100 of a higher-fuel-efficiency version of Airbus’s A320 jetliner, with combined sticker prices topping $10 billion.

The new orders put the European aircraft maker more than halfway toward its goal of increasing its order book for the medium-haul, single-aisle plane to 500 by the end of next week’s Paris Air Show.

The orders from Cebu Air of the Philippines and India budget carrier Go piles further pressure on rival Boeing to offer a version of its own single-aisle 737 jet with more-efficient engines or overtake Airbus with an altogether new aircraft design that boasts lower operating costs.

Both Airbus and Boeing are boosting production of their respective aircraft lines to record levels as growth rates in passenger and freight demand return to the pre-recession levels.

Boeing’s latest forecast sees demand for 33,500 aircraft with more than 100 seats over the next 20 years, valued at an aggregate $4.1 trillion.

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Indian budget carrier Go Airlines said it was buying 72 Airbus A320neos, valued at $7 billion, based on list prices.

In addition, Cebu Air Inc., the Philippines’ largest budget carrier, said it placed firm orders for 30 A321neos. The airline also converted seven options for A320s into firm orders. The 37 planes are worth $3.8 billion at list prices.

Before Thursday’s order announcements, Airbus had received 332 orders for the A320neo, which it says will deliver 15% fuel savings.

Malaysian airline AirAsia is also expected to announce a major order for A320neos during the air show, and other airlines are lining up, industry experts said.