After a year with slow sales, Airbus announced two large orders in the last weeks of 2020. Both Qantas and Air France – KLM announced that they will order Airbus narrowbodies to replace their current 737 fleet.
So, how did Airbus manage to flip these airlines to choose Airbus over Boeing? Let’s Talk Aviation
Qantas
The story of the ever-existing competition between Airbus and Boeing gets a new chapter. First, Qantas. They have ordered 20 XLRs and 20 A220s with options for almost a hundred more aircraft to replace their existing fleet of 717s and 737s.
With the XLR, Qantas hopes to save on fuel, offer more seats, and open up new direct routes, which it was unable to do with the 737-800. While the Australian airline has been an avid user of Boeing aircraft, they have shifted to Airbus over the past decade for their long-haul operations with the A380 and an upcoming order for the A350.
And now, they are also changing their narrowbody fleet from Boeing to Airbus. However, the A320 won’t be entirely new for them as their low-cost subsidiary, Jetstar, has been using the type for some time.
Air France – KLM
The largest order came from Air France – KLM and can be seen as a real change from recent developments. Up until now, within the group, Air France used mostly Airbus aircraft. KLM on the other hand was changing towards becoming an all-Boeing operator. They currently only operate a few A330s which are set to be retired by the end of 2025.
Despite all this, the group announced that they would order a mix of 100 A320 and A321neo aircraft. The order further contains options for another 60. They will replace the existing 737 fleets at both KLM and Transavia, the low-cost subsidiary.
At KLM they will be used together with the Embraer E190 and 95 for short-haul flights. Transavia will change from an all-737 to an all-A320 family airline over time. There will be some serious costs associated with this move for both Transavia and KLM. All of their crew will have to be retrained. Therefore, it is even more interesting looking at why KLM changed its mind and went for the A320 over the MAX.
Politics
The reasons why Air France – KLM opted for the Airbus offer over the Boeing alternative are for some part just political. While the A320-family indeed is a bit more efficient and produces less noise compared to the MAX – which is very important in the densely populated Netherlands from which both airlines operate – the French government likely had a big say in the choice for Airbus.
Over the past years, the French government became more and more involved in the airline group in an attempt to centralize most of the operations into France. During the pandemic, they have increased their share to 29% from just over 9%. The Dutch government, however, didn’t invest extra and stayed at 9% ownership.
Currently, the maintenance for Boeing aircraft is mostly done in the Netherlands and Airbus maintenance is handled in France. While it is at the time of making this video not entirely sure where the new narrowbodies will get their maintenance, it is likely – that at least part – will be done in France.
Next to a stake in Air France, the government also owns part of Airbus. The manufacturer is a large employer in France with a big factory in Toulouse. Amid the covid-pandemic, the government had an interest in making sure those jobs are safe. With this new order, the backlog for Airbus became just a bit larger.
While there almost has been a pull towards Airbus at KLM, Boeing also didn’t do itself any good with the recent issues regarding the 787 which didn’t please KLM, to say the least.
Cargo Order
Next to this, Airbus not only sold a bunch of narrowbodies this month, but they also added some new orders for their A350Freighter. Singapore Airlines ordered 7 and Air France KLM 4 with options for 4 more. For the latter again a change in directions as they currently use the 777F for their cargo operations.