IATA: Hazy in talks with Airbus about Air Lease A320neo deal

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Air Lease Corporation (ALC) chief executive Steve Udvar-Hazy has indicated that the leasing company could place an order for the Airbus A320neo at this month's Paris air show. He is also hopeful that Boeing will soon declare its intentions over a competitive response.

"We're in delicate negotiations. There's still two weeks to go [until Paris]," said Udvar-Hazy, regarding talks with Airbus about the re-engined A320.

Speaking to Flightglobal at the IATA AGM in Singapore, Udvar-Hazy said ALC's existing deal with Airbus for A320 family aircraft comprises orders for 21 A320s and 30 A321s, with deliveries due to conclude in 2013 and June 2015, respectively. "Virtually all the A320s are placed," he added.

That deal, announced at last year's Farnborough air show, does not include any additional options or purchase rights but does have the flexibility to convert unassigned aircraft to the A320neo variant. However deliveries would have to be recycled as the A320neo is not available before October 2015.

Udvar-Hazy added that ALC would evaluate both engines offered on the A320neo, which include the Pratt & Whitney PW1100G and CFM International Leap-X.

Meanwhile the leasing chief is awaiting news from Boeing on its next move in the single-aisle sector, as the airframer evaluates launching either a 737 re-engining or an all-new aircraft. "We're encouraging Boeing to decide its strategy soon. We want to see what's on the menu. I think they're leaning towards an all-new aircraft at the moment."

Udvar-Hazy said he was keen to establish the likely competitive landscape in the single-aisle sector as he evaluates whether to order the A320neo. If Boeing goes for an all-new design it could force Airbus to respond with its own clean-sheet aircraft, which could hamper the longer-term prospects for the re-engined variant. "The issue is, are we looking at an aircraft with a 20-30 year life? If Boeing launches an all-new airplane and Airbus has to respond with an all-new aircraft in the early 2020s, what happens to the Neo?" he said.

The arrival of the A320neo family is affecting efforts by Bombardier to increase the order book for its PW1000G-powered CSeries family, said Udvar-Hazy: "The A319neo impacts the larger CS300 variant - no question."

Regarding air show announcements, Udvar-Hazy indicated that ALC would be making some news about orders at Le Bourget this month, saying: "We've been ordering widebodies, we just haven't announced them yet."