Airbus rears up thanks to the shopping of the American Indigo (Wizz Air)
Airbus goes up on the stock exchange thanks to the maxi-order of aircraft at the Dubai fair. Here are the details and objectives of the private equity firm Indigo Partners, which controls the low cost airline Wizz Air
Shares of Airbus, a European aircraft manufacturer headquartered in France, rose 2 percent on the Paris stock exchange this morning to € 114.42. The increase is linked to the news of the order of 255 A321neo model aircraft from various companies linked to the American private equity firm Indigo Partners.
Each of these narrow-body aircraft is capable of carrying over 240 passengers. Indigo Partners – which controls or owns significant stakes in many airlines such as Wizz Air or Volaris – is betting on a strong recovery in tourism and travel after the pandemic.
THE DETAILS OF THE AIRBUS AGREEMENT
The agreements were announced on the first day of the Dubai Airshow and came at the end of a negotiation process coordinated by Indigo Partners. Specifically, Airbus has signed agreements with Wizz Air (Hungarian), Frontier Airlines (American), JetSMART (Chilean) and Volaris (Mexican).
The value of the order has not been revealed, but is estimated at around 32 billion dollars. Probably the actual sum will be lower, because – as industry experts explain – such large deals usually provide significant discounts, even 50 percent.
Of the 255 aircraft in total, 102 will go to Wizz Air, 91 to Frontier Airlines, 39 to Volaris and 23 to JetSMART.
WHAT INDIGO PARTNERS DOES
The order helped fuel optimism about the aviation industry's prospects, particularly damaged by restrictions on international travel introduced due to the coronavirus pandemic.
The deal shows that Indigo Partners wants to focus on ultra-low-cost airlines , evidently foreseeing that they will be able to ride the travel resumption better than rival companies.
Indigo Partners is not new to large orders for aircraft: in 2017, also in Dubai, it signed an agreement for 430 aircraft, for example.
THE NEW A321XLR
The agreement provides for the supply of 27 A321XLR aircraft – narrow-body, among the largest built by Airbus – to Wizz Air, which plans to place them in the UK and Abu Dhabi.
DELIVERY TIMES
The 255 aircraft ordered will be delivered by Airbus mainly in the second half of the decade.
THE OBJECTIVES OF AIRBUS
Airbus wants to increase production of A321 aircraft from 40 to 64 units per month by 2023; previously he had aimed even higher, at 75.
According to the company, the new models will contribute to international climate efforts by reducing greenhouse gas emissions per passenger, compared to those associated with smaller and older aircraft. Low-cost airlines, due to their large number of flights, are particularly exposed to criticism from environmentalists.
ESTIMATES ON THE DEMAND
According to Airbus estimates , in the next twenty years the demand for more efficient aircraft will require the construction of 39,000 new aircraft: 15,250 of these will replace old models. Consequently – again according to Airbus – in 2040 the “great majority” of commercial aircraft in operation will be latest generation models; to date their share is 13 per cent.
The company says production of new aircraft will be worth 4 percent of global annual GDP and support over 90 million jobs.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/primo-piano/airbus-contratto-255-aerei-indigo-partners/ on Mon, 15 Nov 2021 14:04:28 +0000.