Airbus set to launch A320 NEO

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Airbus will launch a re-engined version of its A320 family aircraft Wednesday, for entry into service in 2016, say industry sources.

The A320 new engine option, or NEO, will be launched with variants of Pratt & Whitney's PW1000G and CFM Leap-X engines.

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The 150-seat A320, the original member of the European airframer's narrowbody family first introduced in 1988, will be the first model offered with the new engine option.

Airbus expects to achieve up to 15% improvement in fuel burn with the new engines, which includes a 3.5% boost with new Sharklets, which enter service in 2012 with Air New Zealand.

The Pratt & Whitney PW1524G engine is scheudled for an entry into service in 2013 on the Bombardier CSeries CS100, the first of two 110 to 149-seat models offered by the Canadian aircraft maker, that are intended to compete with the Airbus A318, A319, Boeing 737-600 and -700.

CFM is currently set to introduce its Leap-X1C under the wing of the 160-seat Chinese Comac C919, which will see its first revenue service in 2016.

The Airbus decision comes after a protracted 'will they, won't they' debate over hanging new engines on the company's best selling models. Boeing still has yet to announce its future plans on its 737, though the decision by Airbus comes as both airframers are boosting production to record levels to satisfy global demand for short-haul aircraft.

Airbus has maintained that it will continue to offer its A320 powered by CFM56-5B and IAE V2500 engines along side those with the new engine option.