March 23, 2018, © Leeham News: In a new, albeit not unexpected, blow to Airbus, Boeing won a hotly contest competition at American Airlines between the A330neo and the 787, two sources say.
Bloomberg News reported Airbus lost the deal, earlier today.
LNC confirmed the decision with two sources. But Derek Kerr, EVP and CFO of American, told LNC no decision has been made, but an announcement could be coming by the first quarter earnings call if not before.
The competition originated with American’s long-publicized ambivalence over the legacy Airbus A350-900 order placed by US Airways long before the latter acquired American, a 787 customer of long-standing. With this deal, American will cancel the A350 order for 22 airplanes.
The new American has been clear that a sub-fleet of 22 airplanes didn’t fit with American’s strategy of simplifying its fleet.
American has nine Airbus A330-300s and 15 A330-200s, also inherited from US Airways. AA previously announced it will phase out the -300s, which date to 1999-2001. The -200s date from 2009-2014, according to the Airfinance Journal Fleet Tracker.
American has 35 787s in service and seven more on order.
The number of 787s and sub-types involved hasn’t been learned, nor the delivery schedule.
The A350s has been deferred until beginning in 2020 and were intended to replace the A330s. Deliveries were slated for 2, 5, 5 and 10, an American SEC filing indicates. The last of the current 787 orders is scheduled for delivery in 2019.
With Boeing increasing the production rate of the 787 to 14/mo from 12/mo, it’s likely the delivery schedule will be similar to the A350.
Boeing was viewed to have the advantage going into the competition, given its large 787 presence already and American’s desire to simplify its fleet.
Boeing’s offer was “aggressive,” LNC is told, similar to the recent Hawaiian Airlines deal in which Boeing displaced Airbus’s existing A330-800 order with the 787.
It’s also been suggested Boeing offered to reconfigure the 787-8s that have an interior designed for the legacy American, but which doesn’t fit into the new cabin strategy adopted by the new American Airlines.
GE Aviation, which provides American’s 787 engines and engines for the Boeing 737-8 MAX and Airbus A321neos ordered by American through its 50-50 partnership with CFM International, repriced an unspecified number of engines, LNC is told.
This hotly fought battle, like the Hawaiian deal, is part of the all-out war that erupted between Airbus and Boeing in which Boeing is trying to kill the A330neo.
Airbus believes Boeing will make any deal to keep Airbus wide-bodies out of the US, but it vows to protect its markets elsewhere in the world.