Airbus deal gives Qantas commonality and range advantages

The unsurprising decision by Qantas to purchase up to 134 Airbus narrowbody aircraft will allow the airline to update its core domestic fleet and to open up new markets, thanks to the greater range of the replacement models.

Despite the improved performance of the new aircraft, perhaps the most compelling factor in the Airbus deal is that it enables the Qantas Group to pool its new orders with its large existing backlog of Airbus narrowbody orders that were earmarked for its Jetstar subsidiary.

This made Airbus the most likely choice in the contest to replace Qantas' current Boeing narrowbody fleet. Not only will Qantas gain efficiencies from fleet commonality, it will also have much more flexibility in growing different parts of the group, timing its capital expenditure, and focusing on the most promising demand segments.