Jul 14, 2016

    AirAsia upbeat on paying less for 100 Airbus A321neo jets


    AIRASIA boss Tony Fernandes flew into Britain to finalise an order for 100 Airbus A321neo jets to support the low-cost airline's expansion, confident of striking a deal at bargain prices as makers brace for a slowdown.

    The 185-seat A321neo is worth US$125.7 million (S$169 million) at list price but AirAsia is expected to pay a fraction of that after establishing itself as one of Airbus' largest customers.

    Mr Fernandes told a news conference the A321neos were in addition to the A320neos, and not replacements.

    Some of the new jets will be for the Malaysia-based airline's leasing business, he added.

    "With this aircraft, we believe we will hit 100 million passengers in the not-too-distant future," he noted, adding negotiations had started over a meal in an Iranian restaurant in London last year.

    Mr Fernandes told reporters that if AirAsia had an opportunity to be in China, "we will 100 per cent be there".

    AirAsia was interested in connecting secondary and tertiary cities in China, he said, adding the company's new head of North Asia had a very clear mandate to build businesses in that area.

    The plane order triggered fraught last-minute negotiations for the contract to supply engines, with papers spread out in the corner of an airline award ceremony.

    But AirAsia was not expected to drop usual supplier CFM for rival Pratt & Whitney.