AirAsia close to placing A320neo order

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Low-cost carrier AirAsia has indicated it will place an order for the Airbus A320neo soon, and expects to convert some of its existing A320 orders to the re-engined A320neo.

AirAsia's group CEO Tony Fernandes says an order announcement "will happen soon". "It's a $7 billion deal. As much as I like to get things done quickly, you can't rush it," he adds.

In 2016, the airline will be left with only 10 A320s on delivery, says Fernandes. Airbus has targeted to introduce the A320neo in 2016. AirAsia currently has 86 A320s on order, according to Flightglobal's ACAS database.

The airline said in February that it had pushed back the delivery of 10 A320s from 2012 to 2015, which would give it some flexibility to switch between the existing A320 variant to a "new generation A320 which is more fuel efficient".

Airbus has said customers with existing orders for A320s will not be able to switch to A320neos, but Fernandes indicates that conversions are likely to take place, even though he adds that these will be minimal. "We don't need to convert that many," he says.

AirAsia has previously deferred deliveries for other reasons, such as infrastructural constraints at the airport it serves.

However, it recently accelerated the delivery of two to three aircraft for its associate carrier in the Philippines, says Fernandes. The A320s, originally scheduled to be delivered in 2012, will be delivered in end-2011 instead.

AirAsia's affiliate carrier in the Philippines will begin international flights in the fourth quarter of this year and will be based at Manila's Clark Airport.