Company - - Dec 29,2017
China Aircraft Leasing Group Holdings Ltd. agreed to buy 50 Airbus SE single-aisle airliners that have a combined list price of $5.42 billion.
The company has said on Thursday, the deal is to buy A320neo Jets, as part of a drive to capitalize on ever-growing demand for air travel in China. The transaction for the A320neo aircraft was done through an amendment to a 2014 purchase agreement, and the European planemaker granted “significant price concessions,” the Hong Kong-based leasing company said in a filing Friday.
With the latest agreement, China Aircraft Leasing’s total order book will rise to 252 aircraft; 202 from Airbus and 50 from Boeing, according to the company.
This deal comes as airlines in China will profit from a boom in domestic and international air journeys as the country's middle-class populace spends more on travel and leisure. Also, it will come as a lift to European giant Airbus, which is competing heavily with United States rival Boeing in China, the world's second aircraft market. Boeing Co. expects China needs 7,240 new aircrafts valued at almost $1.1 trillion in the two decades through 2036, with narrow body aircraft making up for three quarters as well. The country's three biggest carriers are namely, Air China, China Eastern and China Southern.
Further, as per the International Air Transport Association foresees the country will overtake the US as the world's largest air-travel market by 2024. China’s continuous economic growth, significant investment in infrastructure, growing middle class and evolving airline business models support this long-term outlook.
CALC chief executive Mike Poon said that "We are proud to augment our fleet by adding 50 in-demand A320neo jetliners which have outstanding fuel efficiency, and are reliable and comfortable. He further adds that this bulk purchase will expressively develop CALC’s fleet portfolio and further solidify our position as a full value-chain aircraft solutions provider.