03 November 2009

Air NZ opts for A320s

AUCKLAND - Air New Zealand is to acquire 14 new Airbus A320 aircraft, to replace its current domestic jet fleet of 15 Boeing 737-300 aircraft.

As part of the agreement Air New Zealand has secured purchase rights for a further 11 aircraft.

Ã¢â¬ÅâœSubject to final contract, the first A320 aircraft will arrive in January 2011, with the fleet to be progressively introduced through until 2016 coinciding with the expiry of 737 aircraft leases,Ã¢â¬~ said Air New Zealand Group executive, Bruce Parton.

At list prices, the cost of the 14 aircraft is in excess of US$1 billion, however Air New Zealand has secured the aircraft at a discount that reflects the current market conditions.

For the past eight months, Air New Zealand has been evaluating options to replace its Boeing 737-300s.

Ã¢â¬ÅâœThis is a very good time to buy aircraft. The industry is at the bottom of a deep cycle so demand for aircraft is limited, creating favourable conditions for buyers with strong balance sheets like Air New Zealand,Ã¢â¬~ said Parton.

Ã¢â¬ÅâœAs we did with the 777, 787 and earlier A320 purchases, we have been able to buy counter-cyclically and again secure an excellent deal.Ã¢â¬~

Tailnote: In the UK, Irish budget airline Ryanair has said it may stop expanding its business if it does not get a better deal on new aircraft from Boeing.

It is in talks with Boeing about buying 200 aircraft, but says if prices are not cut it will return cash to shareholders instead of buying planes.