Avianca Finalizes $11B Deal for 100 Airbus A320neo Aircraft

Posted on May 13, 2015 linda strong aviation news

In the first week of May 2015, Airbus Group announced that they have finalized an agreement with Avianca, the national airline and flag carrier of Colombia, in which they will purchase 100 of Airbus’ A320neo family aircraft for approximately USD$11 billion. The two companies signed a memorandum of understanding for the deal, which is said to be the largest in Latin America’s aviation history.

This deal specifically calls for Avianca to buy A319neo, A320neo and A321neo aircraft, which will be used to replace their fleet operating from its hubs in Bogota, Lima and San Salvador. "This historic order allows us to solidify our passenger experience strategy in local markets on a broader scale,” said Fabio Villegas Ramirez, Avianca’s CEO who is very proud of this new agreement.

"Thanks to the A320neo family's fuel efficiency, technical reliability and unique passenger comfort, we can further Avianca's fleet modernization process, while connecting the region and supporting its development." Airbus COO Customers John Leahy said in a statement: "The A320neo brings Avianca the highest efficiency at the lowest cost, making it ideally suited to operate within their network and especially within the region's challenging airports."

This is not the first time Avianca and Airbus have worked together. They have previously worked with Airbus on various fleet modernization and expansion programs and in 2012, Avianca placed an order for 51 A320 family aircraft, including 33 A320neo aircraft. Currently, with its new generation engines and Sharklets, the A320neo is claimed to offer more than 15% fuel efficiency.

In Latin America, the A320neo program has so far logged over 345 firm orders from six customers, including Avianca, Azul, Interjet, LATAM Airlines Group, VivaAerobus and Volaris. To date, Airbus has sold over 950 aircraft across Latin America and the Caribbean region and has a backlog of around 500. Headquartered in Toulouse, France, Airbus Group is a European multinational aerospace and defense corporation that manufactures aircraft parts as well as civil airliners.

Airbus was originally formed as the European Aeronautic Defense and Space Company (EADS), but in January of 2014 was reorganized as Airbus Group combining the divisions for development and marketing of civil and military aircraft, as well as communications systems, missiles, space rockets, helicopters, satellites, and related systems.

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