China has confirmed a bulk order with Airbus for 150 A320-family narrowbodies, during a visit to Paris by Chinese premier Wen Jiabao.
Airbus says that it has signed a general terms agreement with the state-owned China Aviation Supplies Import & Export Group (CASGC) covering the purchase of the A320s. It values the deal, comprising A319, A320 and A321 aircraft, at around $10 billion.
The order has been expected; last week industry sources in China told ATI that a major bulk order for Airbus narrowbodies was planned and that it would be announced during Wen’s official visit to France between 4 and 7 December.
China likes to announce orders for foreign goods during high-level political visits. The Airbus deal comes soon after China placed an order for 70 Boeing 737-700/800s during a visit to Beijing last month by US President George W Bush.
Six airlines will be allocated aircraft from the Airbus order: Air China, China Eastern Airlines, China Southern Airlines, Hainan Airlines, Shenzhen Airlines and Sichuan Airlines. All are existing operators of A320-family twinjets.
China’s domestic air transport market has been growing at a rapid rate and many airlines have been seeking Government approval to order more aircraft. Over the past year the focus has largely been on committing to widebody capacity expansion and major orders have been placed for Airbus A330s, Airbus A380s and Boeing 787s.
But both Airbus and Boeing have said they expect many more narrowbody orders from China in the next year or two, as the main focus returns to boosting domestic capacity.
As China’s economy is a planned one the country’s airlines must seek many approvals before acquiring aircraft. After final approval is granted state-owned China Aviation Supplies Import & Export Group signs a general terms agreement with a manufacturer, after which the airlines that are allocated aircraft finalise purchase agreements directly.
The order comes a week after privately owned Chinese start-up carrier East Star Airlines inked a letter of intent with Airbus to purchase 10 A320-family aircraft and agreed to lease another 10 from GE Commercial Aviation Services.
Source: Flight International
