Airbus set to ink huge A320 order from Lion Air

AFP-JIJI, Bloomberg

European aerospace giant Airbus was set to sign Monday what would mark one of its biggest orders ever from Indonesia’s Lion Air for more than 200 A320 medium-haul jets, business daily Les Echos reported.

The deal is expected to be worth more than $20 billion, with a standard A320 model priced at $91.5 million. Its newer, more fuel-efficient NEO plane has a price tag of more than $100 million.

French President Francois Hollande’s office said that he would host the chief executive of Airbus to celebrate the signing of “a major industrial agreement,” but both the plane maker and the French presidency declined further comment.

The government said the deal with the Asian budget airline will be signed as France’s Industry Week kicks off, but declined to give more details on the nature of the agreement.

Monday’s meeting between Hollande and Airbus CEO Fabrice Bregier was scheduled to take place at the presidential palace.

The news comes just days after Airbus received an order worth as much as $15.5 billion from Turkish airlines for up to 117 planes. That order also centered on Airbus’ A320 medium-haul family.

Lion Air, Indonesia’s largest privately run airline, would be a new client for Airbus as it has previously been equipped almost exclusively by U.S. rival Boeing.

In 2011, the Indonesian carrier signed a record $22.4 billion deal for 230 Boeing 737 airliners.

With some 240 million people, Indonesia is the world’s fourth most populous nation and most far-flung archipelago, with more than 17,000 islands scattered across 33 provinces.

Air travel has grown sharply in recent years with the emergence of budget carriers such as Lion Air, as well as rising incomes thanks to steady economic growth.

As France battles with rising unemployment figures, Airbus is one of the few companies that continues to recruit heavily.

In January, Bregier said the company would hire 3,000 people worldwide this year.

An Indian discount carrier operating an all-Boeing fleet, SpiceJet, is considering a full switch to Airbus aircraft as it weighs options for a new generation of planes.

The carrier currently has 37 Boeing 737 aircraft and plans to add seven planes this year — possibly Airbus NEOs instead of Boeing jets.

A switch by SpiceJet would further tilt India’s budget airline fleet market share in favor of Airbus, whose planes are used by IndiGo, India’s biggest domestic carrier, and Go Airlines (India).