Four Chinese airlines buy 292 planes from Airbus for $37 billion

China Eastern has indicated that it will order 100 Airbus A320neos and China Southern has announced that it will purchase 96 aircraft of the same model.

The sluggishness of air transport in China, affected by restrictions linked to the zero Covid policy, is not cutting the appetite of local airlines. Because the needs are immense, in particular to serve domestic and medium-haul routes in the region. Also the Chinese companies anticipate the recovery and announced, this Friday, to have placed a gigantic grouped order relating to 292 Airbus of the A320neo family. This for 37 billion dollars, at the list price.

In China, acquisitions are made by Casc (China Aviation Supplies Holding Company), a state-owned company, on behalf of local carriers. This giant contract is divided between China Eastern, which will receive 100 aircraft, China Southern (96 aircraft) as well as Air China and its subsidiary Shenzhen Airlines (respectively 64 and 32 A320neos). “These orders demonstrate the momentum of the recovery and the bright prospects for the Chinese aviation market,” welcomed Airbus. The Chinese fleet is expected to triple by 2040 to nearly 11,000 planes, according to the latest Airbus market study.

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The planes – A320neo but also A321neo, with greater capacity and longer range – will be delivered from 2023, the year when Chinese air traffic should be back to its pre-crisis levels, and until in 2027. Beijing has set targets for reducing CO2 emissions2 and wants to modernize its fleets with modern and less fuel-intensive aircraft. The A320 and A321neo ordered consume 20% to 25% less than the previous generation aircraft.

For its part, Airbus sees the XXL order book for the A320 (8,000 planes at the end of May) strengthening further. In order to deliver faster, the European giant has started a rapid increase in production. It plans to assemble 65 A320neos per month from summer 2023, compared to 45 planned for the third quarter of 2022 and 40 currently. Then he plans to produce up to 70, or even 75 A320s per month from 2025.

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