Chinese carrier Xiamen Airlines will renew and grow its fleet with forty Airbus A320neo family aircraft. The order is significant in that Xiamen has been a Boeing-only operator so far and has orders for the MAX 8. The news was announced on September 22 by its parent airline, China Southern Airlines, which bought 96 A320neo family aircraft itself in July. Xiamen Airlines adds 40 A320neo family to its fleet.
Xiamen will take delivery of the A320neo aircraft between 2024 and 2027. According to the China Southern statement, the order would be valued at $4.8 billion based on list prices of between $105 and $136 million per aircraft. Airbus doesn’t provide list prices for a few years now. China Southern adds that “the aggregate actual consideration for the Airbus aircraft, which is determined after an arm’s length negotiation between the parties, is lower than the catalogue price as provided by Airbus S.A.S because of the price concessions granted by Airbus S.A.S in relation to the Airbus aircraft.” Disclosing the exact amount would result in the loss of significant price concessions for China Southern. The aircraft purchase will be financed by Xiamen through business operations, bank loans, and other financial arrangements.
As for the reason for the order, China Southern says that it “will help Xiamen Airlines ensure the safety of its strategic development, continue to promote the structural adjustment of its fleet, maintain a steady speed of introduction of A320neo family aircraft. It is expected that the Airbus aircraft will have good economic and comprehensive performance, which will help further improve the operating efficiency of Xiamen Airlines and provide passengers with comfortable air travel experience.”
Xiamen Airlines currently has a short- and medium-haul fleet of nine Boeing 737-700s and 131 737-800s. It has also taken delivery of ten MAX 8s between June 2018 and March 2019 through CSA Leasing, the leasing branch of China Southern. These aircraft have been in storage since the MAX was grounded in March 2019. Chinese airlines are still awaiting the final approval to resume MAX operations. Xiamen is believed to have done a demonstration flight with one of its MAX 8s in recent months. Boeing has another 25 MAX 8s currently in inventory for Xiamen, but if the airline still wants them is not confirmed. Boeing said last week that it will remarket some of the MAX for Chinese carriers that are in inventory. The carrier’s long-haul fleet consists of six 787-8s and six -9s.
This latest A320neo family order is another significant win for Airbus in China. In July, the airframer won orders from China Southern, China Eastern, and Air China for a combined 292 A320neo family aircraft, some of which will go to Shenzhen Airlines. The order was seen as a vote of confidence for Airbus and Europe and against Boeing and the United States, with relations between China and the US being strained for some years.
