A320neo business case may hinge on fuel price: Smisek

Sydney
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The business case for United Airlines to purchase the re-engined Airbus A320NEO may depend on jet fuel prices, United-Continental chief executive Jeff Smisek says in Sydney.

"There are a lot of issues of cost," he says. Airbus says the A320NEO will have a $6m increased list price over existing models and deliver up to 15% fuel savings.

Smisek ponders if the A320NEO will follow the way of winglets. "When winglets came out no one wanted winglets because fuel prices were low. When fuel prices went up, winglets made a lot more sense," he says.

But Smisek notes the carrier is yet to fully review the aircraft.

"I don't think we have enough information to know whether that's for us[or] to make any kind of determination," Smisek says. "We're certainly going to look."

Smisek says United will also look at Bombardier's CSeries, but he is not as keen on it.

"We haven't given a lot of thought to the CSeries," Smisek says. "It's not something we've looked at but we certainly will at some point."

"At this point in time it's really the A320NEO," Smisek says of aircraft to evaluate.

Continental is the world's third-largest Boeing Next Generation 737 operator with 193 in service and 53 on order, according to Flightglobal's ACAS database. It also operates 36 older 737-500 aircraft while United operates 152 Airbus A319 and A320 aircraft with 42 on order.

Earlier this year United Airlines said it would make a new narrowbody selection by the end of 2010. Since the carrier's merger was completed its new executive team pushed the decision back to the 2011 at the earliest.