UPDATE Nov 29 – Some two months after the first reports, Airbus has finally confirmed the news that Croatia Airlines selected the A220 for fleet renewal. The airline has placed a direct order with Airbus for six A220-300s but will also lease nine more. Standardizing its fleet is a sure way to reduce complexity and costs.Â
The selection marks a new period for the airline. Its choice of the A220 is an interesting one. Embraer expressed some confidence recently that it could win. Almost certainly something happened to upset the deal Embraer offered. Croatia Airlines would have benefited from the E2 just as Helvetic has. Great range and low seat-mile costs as well as flight costs. Almost certainly Embraer could deliver before Airbus. But?
Perhaps the deal went to Airbus because of the history. The airline had a long-standing (14 years) order for A319s and then converted this to A320neo. Given the size of Croatia Airlines, losing its €10m deposit would hurt. Would Embraer cover that? Probably not. Airbus had the advantage and no doubt pressed it.
The A220 and E2 both offer excellent economics. The choice between the two is very close. But deals favor the larger OEM with deeper pockets and its ability to offer ancillary items. This is an example of economies of scale. Airbus has larger economies of scale than Embraer. Airbus has access to EU financing whereas Brazil can’t compete on the same scale or move as quickly. This is, no doubt, of great frustration to Embraer.
Meanwhile, Croatia Airlines will have an aircraft with a range to cherry-pick markets across the EU and beyond. Any airline looking for aircraft with seating between 110-145 is fortunate to have the choice of the E2 and A220.Â
