ILFC hopes to firm A320neo deal in coming weeks, in talks with CFM

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International Lease Finance Corporation (ILFC) aims to firm up its memorandum of understanding with Airbus in the coming weeks for 100 A320neos, and is also holding talks with CFM International about its Leap X engine to power some of the aircraft.

Lessor CEO Henri Courpron says both ILFC and Airbus want to firm the agreement - covering 75 A320neos and 25 A321neos - as soon as possible.

Courpron explains that even though ILFC has selected Pratt & Whitney to supply its PW1100G geared turbofan for 60 of the aircraft, the lessor is not precluded from opting for the Leap X, which is also an engine option for the A320neo.

Asked if ILFC is holding discussions with CFM Courpon states: "Of course we are." He also says that ILFC's decision to select the PW1100G to power 60 of its A320neos was not influenced by P&W's participation in the Engine Alliance, a joint venture between P&W and GE that produces GP7200s for the A380. The GP7200 had been selected to power four of the 10 A380s ILFC had on order. In parallel to its A320neo MOU, ILFC cancelled the ten A380s it had on order.

Courpron states ILFC's customers that already operate the A380 - Air France, Lufthansa and Emirates-- are "quite happy" with the aircraft. ILFC's decision to cancel the A380 was less about the aircraft's performance and more about "where we spend our aircraft dollars", says Courpron. While the A380 has had good success commercially, it has a limited customer base, he explains, and narrowbodies are more liquid and easier to move around.

The lessor's firm order for 33 Boeing 737-800s placed at the same time as the A320neo MOU was unveiled was coincidence, Courpron states, adding the -800 has worked well for ILFC and is popular with customers.

Frankly, says Courpron, ILFC was not in a position to order aircraft before now as it worked to get its finances in order.

ILFC is also the first A320neo customer to commit to the A321neo. The lessor's chief says he's convinced the A321neo will become a successful 757 replacement.

Courpron laughs when asked if the orders this week are the first of many for 2011. "We just returned from intensive care and now you want me to run a marathon," he quips.

Noting that ILFC has "demonstrated we can pay our bills", Courpron states, "now we can look down the runway".

But he states ILFC has no intention of being excessive, and will be prudent regarding future orders. Using the A320neo as an example, Courpron states ILFC waited for Airbus to make its decision to re-engine the aircraft. "It wasn't a given," he says. "If the CSeries makes some progress in the market place and when Boeing makes a decision on the 737 we'll act accordingly," says ILFC's chief.