I mentioned several months ago that this was coming.
DL's interest in Airbus aircraft is undoubtedly driven by its complaints that the US subsidizes foreign competitors thru loans for Boeing aircraft by the ExIm bank. Airbus might have a strong chance of future orders at DL until the issue is addressed.
No size of the order has been announced but even if it involves 70 or so aircraft over 5 years, that is comparable to what DL is spending on new aircraft today with the 739ER and new 333s which are expected to be paid for by existing cash generation.
DL has previously said it is generating $5B in cash per year, has paid down extra debt, bought new aircraft. bought back stock, and reduced pension liabilities - and still is generating surplus cash. DL has the ability to spend $2B or more on aircraft without taking on additional debt. Neither AA or UA has yet demonstrated they are generating enough cash to cover their purchase obligations.
Whether DL goes with the 330NEO or not, it is a cheap option for Airbus to develop and something that puts the pressure on Boeing, esp. if the competition is the 787 which is a costly aircraft. The 320NEO and MAX are both engine derivative aircraft that gain most of their cost savings from the engine. DL apparently believes the value of new technology wings and fuselage isn't there even for widebodies at current prices.
If the 330NEO is really a viable aircraft, it shoots the theory of needing an expensive rework of the wing which is what is involved in the 777X. The value of increased performance comes as much from the engine relative to the acquisition cost as a whole new body option.
This statement also validates what I have also said regarding use of the 777 the way AA uses it
Anderson is pushing for a new 275-seat aircraft that would have a range of 5,000-5,500 naut. mi. He argues that “aircraft that underfly their range are uneconomical. You cannot make a 777 consistently profitable flying only East Coast to Europe. That would be routes 1,000 or 2,000 naut. mi. shorter than what it was designed for
DL's interest in the geared turbofan goes back decades. Bombardier's future as a planemaker will live or die based on its ability to produce a new generation aircraft. The CR9 is just not a long-term competitive aircraft and they know it. But it is not viable at current prices. DL is a tough negotiator and prices.
