Monday March 18, 2013
Airbus wins record order from Indonesian Lion Air
PARIS: European aircraft maker Airbus on Monday announced a record order worth 18.4 billion euros ($23.8 billion) from the Indonesian company Lion Air for 234 medium-range A320 jets.
Lion Air, Indonesia's largest private carrier and one of the world's fastest growing airlines, is a new client for Airbus as it has previously been equipped almost exclusively by US rival Boeing.
French President Francois Hollande said a deal that he described as the biggest in the history of civil aviation would create 5,000 jobs in France over the next 10 years.
The agreement, hailed as "historic" by Hollande, was signed at the president's official residence, the Elysee Palace, by Airbus head Fabrice Bregier and his Lion Air counterpart Rusdi Kirana.
Lion Air is to buy 60 classic A320 planes. The rest of the contract involves the new, more fuel-efficient Neo version of the A320 series, which has a catalogue price tag of more than $100 million, though discounts are common for large orders.
According to the Elysee, the A320s currently under production will be delivered from next year while the Neos will be supplied from 2016.
"These are impressive figures which honour European industry and bear witness to the vitality of the Indonesian industry," Hollande said.
"Airbus is the pride of France and Europe. It is one of the pillars of our economy and directly employs 24,000 people," he said.
The news comes just days after Airbus unveiled an order potentially worth $15.5 billion from Turkish airlines for up to 117 planes. That order also centred on Airbus's best-selling, twin-engine A320 family.
Southeast Asia has emerged as one of the world's top market for medium haul planes as rising incomes and a burgeoning middle class have significantly boosted air travel.
Founded in 1999 by brothers Kusnan and Rusdi Kirana, who are ranked the 33rd richest Indonesians with collective wealth of $900 million, Lion Air is the country's first private airline.
Currently it operates a relatively modest 92 planes - all Boeings except for one McDonnell Douglas - which makes it number nine among regional carriers in terms of fleet size.
The company is however set to expand rapidly, having already ordered 230 Boeing 737s for $22.4 billion during US President Barack Obama's visit to Indonesia in 2011.
With some 240 million people, Indonesia is the world's fourth most populous nation and most far-flung archipelago with more than 17,000 islands scattered across 33 provinces. Air passenger numbers are currently growing at 20 percent per year.
Lion Air's 72 destinations are mostly in Indonesia, and the furthest it flies is to Saudi Arabia - a route mostly packed with domestic workers and construction labourers. The company is banned from US and EU skies over safety fears.
In France, where economic stagnation has sent unemployment to record highs, Airbus is one of the few companies that continues to recruit in significant numbers.
In January, Bregier said the company would hire 3,000 people worldwide in 2013.-AFP