Aegean Air picks Airbus for $5 billion order of 42 planes

Aegean Air picks Airbus for $5 billion order of 42 planes

Aegean Airlines will order 42 aircraft worth $5 billion (4 billion euros) from Airbus as Greece’s largest carrier renews its fleet of single-aisle planes, company executives said on Wednesday.

The order is the largest by a Greek carrier and one of the biggest investments by a private Greek company since the country’s debt crisis broke out in 2010.

Seeking to reduce maintenance costs, Aegean, a member of the Star Alliance airline group, had been weighing its options between the Airbus A320neo and Boeing’s 737 MAX.

“Today is a very important day for Aegean,” Vice-Chairman Eftychios Vassilakis said during a news conference. “We confirmed our commitment to improve our competitiveness for signing a deal for an order of up to 42 aircraft.

It is the third time in 19 years that the company is investing in new airplanes, Vassilakis said.

Aegean said it had signed a Memorandum of Understanding with Airbus. The agreement, it said, included the firm order of 30 aircraft – of the A320neo family – with the option of 12 additional aircraft with new generation engines that offer fuel savings of 15 percent.

The agreement is part of the company’s overall fleet expansion and renewal program, expected to take place between 2020 – 2025, Aegean said.

The company wants to replace its aging mostly-Airbus jet fleet and add capacity for future expansion.

The airline, which flies domestic and international routes, also owns former flag carrier Olympic Airlines, which was privatized in 2010. Most of its current leases need to be replaced between 2019 and 2023.

Last year, Aegean grew full-year net earnings by 87 percent on an improved load factor and higher sales riding a strong tourism year. In 2016 it flew a total of 13.2 million passengers. [Reuters]

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