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More narrowbody and regional aircraft orders at Farnborough: Special CAPA Webpage Launched

21-Jul-2010

The avalanche of narrowbody and regional aircraft orders continued on the second day of the Farnborough Air Show. Firm orders and contracts (MoUs and LoIs) for nearly 220 aircraft have been signed, with options and purchase rights potentially stretching this to beyond 390 aircraft. Boeing commented that it is witnessing a release of the “pent-up demand” that had built up during the last two years of recession. Engine ordering has also been strong, with more than USD12.5 billion in engine orders and MRO agreements announced over the first two days of the air show.

See the CAPA Farnborough News Page

Air Lease Corporation, having secured USD3.3 billion in financing since its launch, continued its ordering spree. After announcing firm orders for 51 A320 family aircraft on the first day of the show, the company followed it up with an order for 54 B737NGs, as well as six options. ALC has also stretched its interest into regional aircraft. It announced an LoI with Embraer for 15 E190s, as well as five options. It followed this up with an order with ATR for 10 ATR 72-600 turboprops and ten additional options.

ATR had a particularly busy second day of the airshow. In addition to the ALC order, new Brazilian LCC, Azul, ordered 20 of the manufacturer’s new ATR 72-600s, as well as 20 options. Turboprop leasing specialist, Nordic Aviation Capital, signed a contract with ATR for the purchase of seven ATR 42s (the fourth in 10 months). Loa Airlines and Golden Air both announced orders for two ATR 72-500s.

Avolon, another new leasing firm, also announced narrowbody orders, committing to 12 B737NGs. The Avolon order had already been posted to Boeing's Orders and Deliveries website in Dec-2009, attributed to an unidentified customer.

LAN Airlines signed an agreement with Airbus for 50 A320 family aircraft. The order includes A319s, A320s and, in a first for the carrier, A321s. LAN also announced plans to sell its 15 smaller A318s, under its fleet renewal programme. The airline signed a USD2 billion order with CFM International for CFM56-5B engines for 70 A320 family aircraft, the largest single engine order by a South American carrier.

In one of the few widebody orders of the show to date, Hong Kong Airlines signed an MoU with Airbus to acquire 15 A350 XWBs and 10 additional A330-200s. Under the terms, the airline is converting 15 existing A330 orders to A350 XWBs and placing an additional order for 10 A330-200s. Deliveries of the A330-200s will begin in 2012, with the first A350 XWB arriving in 2018. The carrier is shaping as a major competitive threat to Cathay Pacific.

Russian aircraft manufacturers have also had a solid airshow. After Kartika Airlines announced an order with Sukhoi for 30 Superjet 100s on Day 1, Sukhoi has also been able to announced an LoI with Orient Thai Airlines for 12 Superjets. The Russian manufacturer also confirmed that it still intends to deliver the first Superjet 100 to Aeroflot before the end of 2010, despite delays in Russian certification.

Another Russian manufacturer, Irkut, has signed a landmark agreement with Ilyushin Finance. The two agreed to a Memorandum of Intention to acquire 28 MS-21 aircraft, with an option for another 22. These are to be delivered between 2019 and 2022. Irkut reportedly secured purchase agreements for 50 MC-21s from a Malaysian investment and finance house, Crecom Burj Resources Ltd, in Jun-2010, but no official announcement has been made.

Ilyushin Finance came to Farnborough with its wallet open, signing a contract with Ukrainian manufacturer Antonov to purchase ten An-158 regional jets, with an option for a further 10. The aircraft are scheduled for delivery between 2011 and 2013.

Flybe’s order for 35 E175s has been the high point for Embraer for the show to date. The agreement includes options for 65 aircraft and purchase rights for another 40, potentially stretching the number of aircraft to 140, if all rights are exercised. The order is big news for Embraer, which has had a quite year so far.

See related report: “Flybe to the Moon...” Behind the UK airline's massive Embraer order

Farnborough Air Show aircraft orders: Day 2

Purchaser

Supplier

Aircraft

Quantity

Engines

Value

Notes

Ilyushin Finance

Sukhoi

Superjet 100

28

SaM146

 

MoI. Options for another 22

Ilyushin Finance

Antonov

An-158

10

   

Options for another ten

Avolon

Boeing

B737-800

12

CFM56-7B

 

Previously attributed to unidentified customer by Boeing. Order made Dec-2009.

Orient Thai Airlines

Sukoi

Superjet 100

12

SaM146

 

Letter of Intent

Hong Kong Airlines

Airbus

A350

15

   

MoU. Replacing order for 15 A330s

Hong Kong Airlines

Airbus

A330

10

   

MoU

Azul

ATR

ATR 72-600

20

 

USD850 million

Options for another 20

Golden Air

ATR

ATR 72-500

2

     

Lao Airlines

ATR

ATR 72-500

2

PW 127M

   

Nordic Aviation Capital

ATR

ATR 42

7

     

Flybe

Embraer

E175

35

CF34-10E

USD1.3 billion

Includes 65 options and 40 purchase rights, potentially increasing order to 140 aircraft

Air Lease Corporation

Boeing

B737NG

54

   

Options for another six

Air Lease Corporation

ATR

ATR 72-600

10

   

Options for another ten

Farnborough Air Show engine orders: Day 2

Purchaser

Supplier

Engine

Quantity

Value

Notes

LAN Airways

CFM International

CFM56-5B

140+

USD2 billion

Includes a long-term service agreement.

Etihad Airways

GE Aviation

Genx-1B

78

USD1.8 billion

Includes 15 year service agreement

Vietnam Airlines

International Aero Engines

V2500

72+

USD700 million

 

Boeing had a good day on the stock market yesterday, rising 1.1%, while Airbus' parent EADS dropped 2.9%. Embraer outperformed once again, rising 5.7%, while Bombardier also surged 5%.

Selected Original Equipment Manufacturers daily share price movements (% change): 20-Jul-2010

The lessors were stronger, led higher by AerCap (+3.4%) and FLY Leasing (+2.8%).

Selected Aviation Suppliers & Leasing daily share price movements (% change): 20-Jul-2010


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