Paris Air Show deals seen as good news for Airbus in Mobile

Some of the orders racked up by Airbus at the 2017 Paris Air Show could mean billions of dollars' worth of work for the company's Mobile operation, though a company spokeswoman cautioned that it's not immediately possible to say what jets will be built where.

As of Tuesday, Airbus had announced several deals involving its A320 family of single-aisle jet. They're built at four location around the globe -- Toulouse, France; Hamburg, Germany; Tianjin, China; and Mobile - and include four models with a variety of new and conventional engine options.

Overall, industry observers saw the show's biggest battle as the competition between Boeing - which racked up early orders for its new single-aisle 737 Max 10 - and Airbus, whose news included a new open data platform, new cabin designs and a concept for a new high-speed helicopter. Bloomberg went so far as to report that Boeing had "overwhelmed" Airbus thanks to demand for the 737 Max 10, but cautioned that the show wasn't yet over.

Regardless of who sold more jets, continuing demand for A320-family aircraft indicated that the Airbus Final Assembly Line (FAL) in Mobile will stay busy.

In one deal announced Tuesday, Delta Air Lines increased a May order for 30 A321ceo jets to 40. The "ceo" suffix denotes "conventional engine option," while "neo" indicates newer, more efficient powerplant.

Because the Mobile FAL was built primarily to serve North American demand, and because it has so far produced only A321ceo jets, the deal would seem to land right on its doorstep. According to the official announcement from Airbus, "Many of Delta's A321s are being delivered from the Airbus U.S. Manufacturing Facility in Mobile, Alabama. The airline received its first U.S.-manufactured A321 last year.  By the end of 2017, the Airbus facility in Mobile is expected to produce four aircraft per month, most going to Airbus' U.S. customers."

However, Kristi Tucker, director of communication for Airbus Americas, said it's not cut and dried. "We don't have that amount of detail yet" on the new deals, she said. The production planning process ultimately will decide whose new jets get built where, and when.

Still, she said, good news for the company is good for Mobile.

"Any order placed for aircraft at the Paris Air Show, no matter whether the client is U.S.-based or not, is good for Airbus," she said. "It solidifies the backlog, which solidifies the need for work here."

Tucker said that as of the end of May, Airbus had delivered 7,610 single-aisle aircraft, and had orders in hand for 5,501 more. The Mobile FAL is on track to hit a production target of "Rate 4," or four jets per month, later this year. Future demand is a key factor in deciding where the FAL goes from there. While Airbus has never announced specific plans to go beyond Rate 4, Tucker said the facility "could hold Rate 8," meaning double that production rate.

In another deal announced in Paris, Latin American company Viva Air signed a memorandum of understanding involving 35 A320neos and 15 A320ceos. Tucker said that while theoretically Airbus could build those aircraft at any of its four FALs, current plans call for the Mobile FAL to serve North American demand. On a technical level, the Mobile FAL currently is building its first A320, for Spirit Airlines, and while the FAL has built only conventional-engine jets so far, plans do call for it to offer neo configurations in the future.

Other new deals:

Air Lease Corp. signed a firm order for 12 more A321neos. "The market for A321neos is strong and our customers want more aircraft," said John L. Plueger, Air Lease Corporation's CEO and president. Air Lease Corp. is based in Los Angeles, but Tucker said that leasing companies may serve international clients, so it's not certain the jets involved will be built in North America.

GE Capital Aviation Services, also a leasing operation, signed a firm order for 100 A320neo family aircraft. That brings the total of Airbus aircraft ordered by the company to nearly 600, according to information provided by Airbus.

CDB Aviation Lease Finance DAC, a Chinese-owned leasing company based in Dublin, Ireland, signed a memorandum of understanding for 30 A320neos and 15 A321neos. It also converted 15 previous A320neo orders to A321neos. "This is another endorsement from the lessor community for the NEO, and takes our NEO customer base well over 90," said Airbus Commercial Aircraft Chief Operating Officer for Customers John Leahy.

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