FARNBOROUGH: A330neo to offer ‘compelling price difference’ – ALC

Farnborough
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Air Lease president John Plueger expects to see “very strong” market interest in the re-engined Airbus A330neo as a result of a “compelling price difference to any other widebody”.

This, he says, will particularly be the case on routes with up to 8h flight time, which account for 75-80% of all long-haul routes and are the fastest-growing.

US-based ALC is set to become the launch customer for the re-engined widebody after signing a tentative agreement for the purchase of 25 A330-900neos at the Farnborough air show yesterday. At list prices, the deal has a value of $6.9 billion.

The A330-800/900 will be able to compete in that niche as the A350 and Boeing 787 are optimised for longer routes, says ALC chairman Steven Udvar-Hazy. He says that Airbus has “very effectively” addressed two out of the three main cost drivers for airlines: fuel and capital investment expenses, with labour costs being the third main driver.

Udvar-Hazy sees a particular capital cost advantage versus the 787-9. Boeing would need to reduce its production costs for the type and be “more flexible” in making the aircraft more competitive for shorter routes, he says. But he adds: “I can’t believe they can close that pricing gap.”

Air Lease has identified customers for “at least half” of the 25 A330-900neos, says Plueger. The lessor is in talks with “upwards of 60” airlines, comprising “very large” legacy network and low-cost carriers, he says.