Qatar Airways has swapped its order for the A319neo in favor of the A320neo, leaving just 29-39 orders remaining for the smallest version of the neo family.
Qatar became the first customer for the A319neo when it placed a surprise order at the 2009 Paris Air Show. Bombardier had negotiated a contract for 20 CSeries to be signed at the show, and with market expectations high, was embarrassed when Qatar’s CEO, Akbar Al-Baker, did one of his famous U-Turns and didn’t proceed. (Al-Baker would embarrass Boeing and Airbus at later air shows by withdrawing an announced deal for the 777-300ER and no-showing at an Airbus press conference.) We were reliably told that the French government intervened with the Qatari government to block the important CSeries order at the Paris Air Show in favor of an order for the A319neo and A320neo.
Avianca Colombia retains an order for nine and Frontier Airlines has 20, according to the Ascend data base. Flight Global reports Avianca has 19 on order, however, and this is the figure shown in an Avianca presentation, probably reflecting options yet to be exercised. Avianca is scheduled to get three in 2017, two in 2018 and the rest in 2019, according to Ascend. Frontier is scheduled to begin taking delivery in December 2018 through 2020.
This means the A319neo, which was supposed to enter service in 2016, six months after the October 2015 EIS for the A320neo, now slips behind the A321neo EIS.
The new EIS schedule means the A319neo still is planned to enter service two years before Boeing’s 737-7 MAX but two years after Bombardier’s CS300. Embraer’s E-195 E2, which seats 133 in single class to the A319neo’s 156 in single class, is scheduled to enter service in 2019.
The Frontier order is iffy, we believe. The CEO, David Siegel, told us a couple of years ago economics of the A319 aren’t very good in today’s fuel environment and favored the larger A320. Frontier was then owned by Republic Airways Holdings and was sold this year to Indigo, an investment group (not related to India’s Indigo Airlines). Indigo was principal owner of Spirit Airlines, an ultra-low cost carrier in the US. Siegel has been transforming Frontier from a low cost carrier to a ULCC. The new ownership is certain to accelerate this transition.
We expect the new ownership will also favor the A320neo and A321neo, and that eventually the order for the A319neo will be up-sized. We believe Avianca will inevitably follow.
This means Airbus will probably drop the A319neo eventually. The A319ceo may be retained through 2019 at steeply discounted prices, but more likely the A320ceo with deep discounts will be Airbus’ continuing competitive response to Bombardier’s CS300 and, to a lesser extent, Embraer’s E-195 E2.
Boeing has sold the 737-7 only to Southwest Airlines and WestJet. Southwest is said to need the 737-7 for its Midway Airport operations. Air Canada has the option to convert some of its 737 MAX orders to the -7.