28 May 2011

Rumour: Airbus wins Delta Narrowbody search.

According to several sources DL will announce in next few weeks a substantial initial order probably exceeding 100 aircraft of the A320 NEO family. The options will likely be up to 300 aircraft and flexed to include 3 members of the 320 family with 319/320/321 all to be included. The 321 will be used to replace the aging 757 fleet and is the most urgent of the aircraft replacements required by Delta. The A319 NEO will be used to replace the MD88 fleet. With 737-800s and -700s still being delivered and MD90s still entering the fleet – the need for smaller sized aircraft is not as pressing.

The door still remains open for a smaller C-Series, Superjet or MJX type aircraft as Delta right sizes its fleet and retires the older 50 seater RJs. So Delta has left the door open for a really killer deal by Bombardier should the Canadians come up with something. The other players should be considered as extreme dark horses. The prevarication by Boeing on its 737 replacement aircraft and the conflicting model sizes have not helped its cause with Delta. With the debacle over the 787 program and its myriad of delays including not least the issues of missing performance metrics of the early model deliveries – Delta doesn’t want to back such an “iffy” in its need to replace its 757 and MD88 fleets. With the economies of scale not likely to kick in for a brand new Boeing aircraft – the decision for Delta has become clearer.

The signals from Chicago/Seattle are that don’t expect a decision on the 737R any time around the Paris Air Show. Delta needs to be assured that the stream of aircraft can arrive at a reliable rate from its supplier. For Airbus with now 3 production line locations open – this is more reliable than Boeing who has not even selected the location for the 737R first line. For a 2016 delivery and for multiple years beyond that – Airbus has the ability to commit and guarantee. On the other hand Boeing has not shown itself to be reliable as a supplier in its next gen aircraft.

Perhaps this is a wake up call. Boeing might about now be thinking that Chicago might not be the centre of the universe.


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