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Airbus seals its biggest deal with $49.5 billion sale to US firm

© Pascal Pavani, AFP | View of a model of an airbus A321, taken on January 11, 2017 at Airbus' headquarters in Blagnac southwestern France.

Text by NEWS WIRES

Latest update : 2017-11-15

Airbus announced on Wednesday that it will sell 430 airplanes to U.S. firm Indigo Partners for $49.5 billion in the European firm's biggest deal ever.

The announcement came at the Dubai Air Show and the deal includes 273 A320neos and 157 A321neos. The airlines that use the aircraft will include Frontier Airlines, JetSMART of Chile, Volaris of Mexico and Wizz Air of Hungary.

A320neos list for $108.4 million apiece and A321neos at $127 million. Airlines and manufacturers often negotiate lower prices for big deals like these.

Indigo Partners is a Phoenix-based private equity firm. It owns Denver-based Frontier Airlines and owns part of Mexico's Volaris. It is managed by William Franke, a pioneer of the cheap tickets and high fees airline business that has spread overseas and is growing in the United States.

Airbus' previous biggest-ever sale came in August 2015, when it sold 250 A320neos to Indian budget airline IndiGo, a deal estimated to be worth $26 billion at list prices. IndiGo and Indigo Partners are separate firms with separate management.

Until Wednesday, the only major deal announced at the Dubai Air Show came on Sunday, when long-haul carrier Emirates purchased 40 Boeing 787-10 Dreamliners in a $15.1 billion deal.

Airbus, which is based in Toulouse, France, has pinned hopes of continuing production of its A380 double-decker jumbo jet on Emirates, the world's largest operator of the aircraft. Reports circulated before the air show that a major A380 sale would be coming.

Airbus employees even filled a news conference on Sunday, expecting the A380 sale, instead to find state-owned Emirates making the deal with Boeing in front of Dubai's ruler, Sheikh Mohammed bin Rashid Al Maktoum.

Emirates now relies solely on the Airbus 380 and the Boeing 777 for its flights, making it the largest operator of both. It has 165 Boeing 777s in its fleet today and took possession of its 100th A380 earlier this month.

The Emirates' snub even came up at the news conference Wednesday, when a reporter asked Airbus if another deal could be coming.

"I think you've got to walk over to the chalet with Emirates on the door and ask them," said John Leahy, Airbus' chief operating officer.

(AP)

Date created : 2017-11-15

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