New Delhi (CNN Business)Australia’s Qantas is choosing Airbus (EADSF) over Boeing to replace its domestic fleet. The decision is a big blow to the American aircraft maker, and a major win for its European rival.
The airline said Thursday that it plans to buy 40 Airbus planes, including 20 A321XLR jets and 20 A220 carriers.
The company will also have the right to buy another 94 aircraft over the next 10 years “as its existing Boeing 737-800s and 717s are gradually phased out.”
The order is subject to board approval, and is expected to be finalized by June next year, the airline added.
“This was a very tough choice to make,” said CEO Alan Joyce said in a statement. “Each option delivered on our core requirements around safety, capability and emissions reductions. But when you multiply even small benefits in areas like range or cost across this many aircraft and over the 20 years they’ll be in the fleet, Airbus was the right choice as preferred tenderer.”
The company expects aircraft to start arriving by the middle of 2023 with deliveries to be spread over the next decade, Qantas added.
Qantas has shifted away from Boeing (BA) in recent years, including by picking Airbus as its partner to fly the world’s longest passenger routes.
The news comes as a blow to the American aircraft maker, which is still trying to rehabilitate its image after the 737 Max crisis. Max planes were grounded worldwide for 20 months in 2019 and 2020, following two crashes that killed 346 people. It was approved to fly passengers in the United States late last year and is now in service in most of the world except China, a key market for air travel.
Like airlines worldwide, Qantas (QABSY) has been hit hard by the Covid-19 pandemic. Joyce said in another statement that capacity dropped significantly, especially as Australia spent much of the year with extremely tight border controls and local lockdowns. But he also expected demand to pick up over the Christmas period and into early next year as more restrictions ease.
“We’ve significantly reduced our cost base which improves our ability to recover,” he added.
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