AP NEWS
ADVERTISEMENT
Related topics

Air Canada Orders 34 Airbus A320 Jets

July 20, 1988 GMT

MONTREAL (AP) _ Air Canada has ordered 34 European-built Airbus A320 passenger jets at a total cost of 1.8 billion Canadian dollars, or around $1.5 billion, for the aircraft and parts, the airline announced.

The government-owned airline also said Wednesday it has taken an option to buy 20 additional aircraft which could be converted to a stretch version of the 137-seat, narrow-body A320.

The A320, the world’s first fully computerized civilian aircraft, uses 40 percent less fuel than similar aircraft and is the fastest-selling plane in aviation history.

ADVERTISEMENT

Air Canada spokesman Denis Couture said the new planes will be maintained and overhauled in Winnipeg, Ontario.

The announcement comes just a month after the sophisticated plane’s reputation was tarnished by the first-ever crash involving an A320. Three people were killed and more than 50 injured when an A320 went down at an air show in France.

Air Canada’s decision ends months of speculation that the airline would select the Airbus, manufactured by Europe’s Airbus Industrie, over bids from U.S. rivals Boeing Co. and McDonnell Douglas Corp. Airbus, which is financed by the governments of France, Britain, West Germany and Spain, competes intensely with Boeing and McDonnell Douglas.

″We’re very disappointed in Air Canada’s selection of Airbus,″ said Boeing spokesman David Jimenez in Seattle. ″The new generation (Boeing) 737-400 would have provided Air Canada with airplanes featuring both proven technology and considerable Canadian content, airplanes which we felt would have best met the airline’s fleet replacement needs.″

Delivery of the 34 A320s will begin in March 1990 and continue until 1993, Air Canada said.

The new aircraft will replace an aging fleet of 33 Boeing 727s used on Air Canada’s short- and medium-haul domestic routes.

No A320s are currently in use in North America although several U.S. companies have them on order. Northwest Airlines has ordered 100 of the planes, Pan Am Corp. has ordered 16, and two U.S. leasing companies - GATX Air and International Lease Finance Corp. - have ordered a total of 13.

Only four of the new planes are in service, two of them operated by Air France and two by British Airways PLC. But more than 500 have been ordered by 21 customers worldwide, including the French and British carriers.

ADVERTISEMENT

″Air Canada is very pleased to be the first airline in Canada to operate the A320 and start its fleet renewal process with an aircraft that the industry clearly considers a winner,″ Air Canada President Pierre Jeanniot said in a statement.

″The replacement of the B727 represents the first phase of our fleet renewal program,″ said Jeanniot. ″This program will be financed through internally-generated funds and various financial instruments, including public bond issues, bank credits, private placement loans, aircraft sales and equity financing.″

A bill to sell 45 percent of Air Canada’s stock to individual shareholders has been approved by Canada’s House of Commons and is now under study by the Senate.

In Toulouse, France, Airbus welcomed the Air Canada decision, saying it reinforces the A320′s position as the fastest-selling commercial aircraft.

″We are extremely pleased that Air Canada placed its confidence in the A320 to meet its fleet replacement and modernization needs,″ said Airbus President Jean Pierson.