Business

Airbus wins $1.4 billion order for 13 planes from Peach Aviation

Bloomberg

Airbus Group SE won an order for 13 Airbus planes valued at about $1.4 billion (about ¥154 billion) at list prices from Japanese budget carrier Peach Aviation Ltd., making inroads in a nation where most aircraft come from Boeing Co.

Peach signed an agreement to buy 10 A320neo aircraft and three A320ceo planes, it said in a statement Friday. The carrier plans to expand its fleet to at least 35 planes by 2020 and to 100 later, CEO Shinichi Inoue said Friday at a briefing in Tokyo that was also attended by Airbus Group Chief Operating Officer Fabrice Bregier.

The order for A320neos, with the first scheduled to be handed over in 2019, is a bright spot for a plane model that’s been plagued by engine issues. Peach, backed by ANA Holdings Inc., started operations four years ago and is buying more planes as demand for low-cost travel in Japan spurs growth.

The carrier plans to set up a base at Sendai Airport next year and at Sapporo’s Shin-Chitose Airport in 2018, Inoue said.

Peach operates 18 Airbus A320s and competes against Jetstar Japan Co., the budget carrier backed by Qantas Airways Ltd. and Japan Airlines Co., and other low-cost airlines.

The A320neo has a list price of $107.3 million, while the A320ceo is priced at $98 million. Discounts are common in the industry.

Airbus won its first order from Japan Airlines three years ago. ANA, which already operates the single-aisle A320, ordered wide-body A380s earlier this year.

ANA is Peach’s largest shareholder with 39 percent, followed by First Eastern Aviation Holdings Ltd. with 33 percent, and Innovation Network Corp. of Japan with 28 percent.

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