JetBlue Airways is placing a big bet on Airbus’s newest jetliner.
The carrier is ordering 60 of Airbus’s A220 jets, the freshly re-christened plane formerly known as Bombardier’s C Series. Tuesday’s sale is the first since Airbus took control of the aircraft program last week from Bombardier.
The JetBlue order is valued at $5.4 billion based on list prices, but customary discounts would bring the total down to about $2.2 billion based on estimates from aircraft valuation firm Avitas.
The deal caps JetBlue’s long search for a more efficient small jet to replace its Embraer E190 aircraft, which it relies on to ferry passengers on such routes as Boston to New York. The order also provides an immediate impetus for the A220, suggesting that Airbus will be able to entice more airlines to buy the plane.
“This fleet transaction is a game changer for JetBlue’s economics as we progress through the next decade,” the airline’s chief financial officer, Steve Priest, said in an interview.
For Airbus, quickly racking up orders for the A220 is a crucial challenge as the Toulouse, France-based company seeks to lower costs. To make the aircraft viable, the planemaker says it needs a “double-digit” reduction in costs in its supply chain and is in the process of negotiating with suppliers.
For JetBlue, the transaction will yield an all-Airbus fleet, which Priest called an “undoubted advantage” because it will reduce costs
Article source: https://www.seattletimes.com/business/jetblue-places-big-order-for-newest-airbus-a220-jet/
