The key to Airbus's success at EasyJet was the level of concessions and guarantees it was prepared to offer. However, Airbus chief executive Noel Forgeard insists that "the deal is profitable for Airbus, and is cash positive".
The European manufacturer will ensure the airline makes a smooth transition to the A319, by investing heavily in retraining EasyJet pilots, assisting with maintenance and building the airline's spares inventory before service introduction. It has guaranteed that the "cost of operation will be lower than that of the competition, evaluated on seat-mile costs".
As part of the deal, Airbus will help EasyJet "reduce residual value risk" on the 10 737-300s the airline owns, and this could involve Airbus remarketing them if required.
Boeing claims it was not prepared to match Airbus's pricing strategy, but does not expect to be undercut elsewhere. "It was a unique order, and our dominant position [in the low-cost market] caused our competitor to work aggressively to achieve that," says Boeing chief executive Phil Condit. He adds: "There are no examples of a low-cost carrier successfully operating a mixed fleet."
Source: Flight International
