Selection of Engine Supplier
14-Jul-2014 easyJet announces that it has selected CFM International S.A. ("CFM") as its engine supplier to provide 270 engines to power its firm order of 35 Airbus current generation A320 aircraft ("Current Generation Aircraft") and 100 Airbus new generation A320neo aircraft ("New Generation Aircraft"). CFM will also provide engines for any future exercise of the 100 purchase rights over New Generation Aircraft. The Current Generation Aircraft are planned for delivery between 2015 and 2017 and the New Generation Aircraft are planned for delivery from 2017 until 2022 under the framework arrangements with Airbus S.A.S. which were announced on 18 June 2013 and further details of which were set out in a circular to shareholders published on that date (the "Circular"). The Current Generation Aircraft will be powered by CFM56-5B engines and the New Generation Aircraft will be powered by CFM LEAP-1A engines.
The framework arrangements relating to firm orders for 35 Current Generation Aircraft and 100 New Generation Aircraft, purchase rights over 100 New Generation Aircraft and their related engines received shareholder approval on 11 July 2013.
Following extensive negotiations with CFM, easyJet has achieved a modest improvement in pricing of the overall framework arrangements. The terms of the framework arrangements are subject to confidentiality restrictions and do not materially differ from the arrangements described in the Circular.
Carolyn McCall, easyJet Chief Executive, said:
"Both engine manufacturers wanted to win our business and competed hard during a thorough selection process. Ultimately CFM offered us the best overall deal.
"We are pleased to have signed a deal with CFM - a company with which we have a long history and a great working relationship - and look forward to introducing the new LEAP-1A engine into our fleet.
"The engines will help easyJet to maintain its low cost base and the new generation A320neo is expected to deliver a cost per seat saving of between 11% and 12% compared to the current generation A319. They will also provide important environmental benefits through a significant improvement in fuel efficiency and a reduction in noise."