MIAMI — Speaking to a gaggle of reporters after a press conference in Montreal, Canada, AirAsia Group CEO Tony Fernandes said AirAsia was considering purchasing the Bombardier CSeries.
Earlier in the day, Bombardier took Fernandes on a CSeries demonstration flight to showcase the next generation aircraft. The news, first reported by Reuters, would give the CSeries program a much-needed boost. The last order for the CSeries came all the way back in April of 2016 when Delta Air Lines placed an order for 75 CS100s.
“For Bombardier, having an order from Air Asia would confirm the value proposition of how much savings the CSeries offers in light of its purchase price and fleet introduction cost. This would confirm a lower seat cost along with a quick turnaround at airports, meaning more flights per day. AirAsia would be a key transaction confirming the CSeries in the low-cost carrier market,” said Sylvain Faust, Founder of FliegerFaust.com.
Should AirAsia order the CSeries, we predict the order would be sizable. Throughout its history, AirAsia has traditionally ordered aircraft in large quantities. In June of 2011, AirAsia ordered 200 A320neos at a list price of $18.5 billion. The order was the largest A320 order at the time. The airline once again opened up its wallet in July of 2016 when they ordered 100 A321neos for $12.5 billion at list price.
The entire AirAsia group operates a fleet of 215 aircraft comprised of 185 A320s and 30 A330s. The group does lack an aircraft smaller than their 180 seat A320 and would be ripe to add a fleet of smaller aircraft.
It is important to note that Fernandes took a ride on the CS300 and not the smaller CS100. The CS300 seats 130 in a two class configuration but AirAsia would likely squeeze up to 160 passengers into it in a one class configuration.
“As Air Asia is one the largest and fastest-growing low-cost carriers in the Asia Pacific region, the CSeries CS100 and CS300 would be a perfect fit and allow for even stronger economics. Bombardier has a winner on its hands and it is nice to finally see carriers selecting the new jets,” said William Evans, Founder of Globalflyer Airline Consulting.
As seen in the map above, the impressive range of the CSeries (3,100-3,300 miles) would allow AirAsia to operate to almost every market it serves in Asia.
In East Asia, only Korean Air has ordered the CSeries. Last week, the first of ten CS300s for Korean Air completed paint in Mirabel.
In January, the first CS100 for Delta Air Lines will begin final assembly. Delta has already installed a CSeries simulator at its headquarters in Atlanta and will soon begin training pilots. Delta plans for the CSeries to enter revenue service in the first half of 2018.
— Eric (@GoldboxATL) August 24, 2017
Should AirAsia order the CSeries many will turn their attention to how many aircraft they order and at what price. Brazil, home of Bombardier’s largest competitor Embraer, recently asked the World Trade Organization to set up a dispute settlement panel to resolve the ongoing trade dispute between Brazil and Bombardier.
Brazil launched a complaint with the World Trade Organization under the belief that Bombardier sold CSeries aircraft at below production costs with financial support from the Canadian government.
“The Brazilian government hopes that the litigation will allow the rebalancing, as soon as possible, of the conditions of international competitiveness in the aeronautical sector, artificially affected by the Canadian subsidies,” said the Brazil Foreign Ministry in a statement.
In the coming months, all eyes will be on Tony Fernandes as AirAsia prepares for its next order.
Cover image courtesy of @aviation.concepts on Instagram.