China Southern Airlines has signed a purchase agreement for 20 Airbus A320 aircraft, for delivery over 2011-13.

The Guangzhou-based carrier has not stated an engine selection. Its current A320-family jets are fitted with both CFM International CFM56s and International Aero Engines V2500s.

China Southern says that the acquisition will increase the company's capacity by 4.5% compared with that available at the end of 2009.

"The acquisition will facilitate the optimisation of the structures of the group's aircraft fleet and traffic capacity, thus enhancing the competitiveness and core competence of the group," it adds.

China Southern says that while the catalogue price for the twin-jets is $76.9 million each, the actual consideration is "significantly lower" because of concessions granted by the airframer.

It says that these concessions take the form of credit memoranda which could be used to purchase spare parts or other services from Airbus. The overall consideration will be partly paid in cash, and partly through financing arrangements with banks.

Source: Air Transport Intelligence news