By Canadian Press

Airbus, Jazeera Airways reach $3.3 billion aircraft deal

Nov 16, 2021 | 2:14 AM

DUBAI, United Arab Emirates (AP) — Airbus won its third deal of the Dubai Air Show on Tuesday valued over $3.3 billion to sell 28 new aircraft to Kuwait’s Jazeera Airways.

The European plane maker’s agreement includes 20 single-aisle A320neos and eight A321neos, which competes directly with Boeing’s 737 Max, along with an option to sell another five planes to the low-cost, fast-growing airline.

While the executives described the deal as a memorandum of understanding rather than a firm order, Rohit Ramachandran, CEO of Jazeera Airways, said he considered the handshake “to far exceed any immediate formal collateral” behind the agreement.

“There’s a great level of trust to which honestly one could ascribe a significant dollar value,” said Ramachandran, calling it a “realistic, modest” order. The executives said the first planes should be delivered in 2026.

The Kuwait-based Jazeera Airways, an upstart Middle East discount carrier, launched in 2004 as one of the first non-government owned airlines in the Persian Gulf while demand and competition for low-cost travel intensified in the region.

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The frenetic trade show in Dubai sees a stream of order and product announcements. On the first two days, Airbus also made blockbuster sales, selling 111 new aircraft to the Air Lease Corporation and 255 new aircraft to Indigo Partners’ various low cost carriers — a deal valued at some $30 billion, based on the pre-pandemic price list.

The purchases have signaled that airline executives see the ravaged industry recovering from the coronavirus pandemic, with demand for travel set to strongly increase in the coming years. Not long ago, airlines were asking for government bailouts as the virus closed borders and grounded planes.

The trade show typically pits France-based Airbus and its American rival Boeing, the two manufacturers at the top of the supply chain, against each other in the crucial Mideast market filled with long-haul carriers connecting East and West. Boeing has yet to make a major order announcement at the show.

Long-haul carrier Emirates meanwhile announced that late next year it would start retrofitting 105 of its wide-body planes, including Boeing 777 and the superjumbo A380s, with a new wood-paneled comfortable cabin class called Premium Economy, which offers much more space than coach but at a lower fare than business class.

Isabel Debre, The Associated Press