Talks with suppliers begin as narrowbody replacement evaluation moves into final stages

Aer Lingus says it has narrowed down its short-haul fleet renewal evaluation to the Airbus A320 and Boeing 737-800, and is in talks with suppliers about a deal for up to 30 aircraft, with deliveries starting from 2004.

Since the beginning of the year the airline has been looking at how to replace its entire narrowbody fleet of four A320s, six A321s, three 737-400s, eight 737-500s and six BAe 146s with a single type.

"We recognise that there is a lot of cost tied up with the eclectic fleet we have," says Aer Lingus chief executive Willie Walsh. He says the strategies of leading low-cost carriers influenced the decision to move to a single-type approach instead of the "traditional thinking" of having a family of aircraft sizes.

Aer Lingus is in discussions with manufacturers and lessors, as it intends to maintain its acquisition strategy of having a one-third/two-third lease/owned ratio.

"We are looking at 20 aircraft plus options for 10," says Walsh, but he adds that the final total will depend on the number of its existing A320s that are retained if it opts for Airbus. If the 737-800 is selected, the type would have to replace the carrier's entire short-haul fleet.

Although the A320 and 737-800 are "front-runners", the airline has also been considering the smaller Airbus A319 equipped with EasyJet's 156-seat double overwing exit configuration and the 737-700, and Walsh stresses that neither aircraft is completely ruled out.

Walsh says the airline has no deadline for a decision, but he wants to start phasing out the BAe 146s next year and could acquire replacements on interim 18-24 month leases, if delivery of the new fleet cannot begin in time.

A decision on the financing for the order has not been made, but Walsh says it will not rely on its privatisation to finance the expansion. He stresses that the order will take place regardless of the Irish government's decision on a trade sale of the carrier.

Aer Lingus has appointed financial advisers PriceWaterhouse-Coopers to gauge the market regarding a possible sale or partial sale of its catering division. It will advertise for expressions of interest in the next couple of weeks.

Source: Flight International