Money & Industry

Indonesia’s Lion Air Signs Biggest Deal for Airbus

Indonesia’s Lion Air Signs Biggest Deal for Airbus
Bernadine Racoma

Indonesia’s Lion Air recently signed an order for $24 billion worth of planes from Airbus. French President François Hollande announced that the order is for a total of 234 A320 series aircraft. The order includes 109 A320neos, 65 A321neos and 60 A320 with the current engine option.

The neo sub-variants

Except for the engines, there is almost no difference between the “New Engine Option” sub-variants, designated with the -neo suffix, and the “Current Engine Option” or -ceo. The engines are a new generation which consume 15% less fuel, and will be 20% less expensive to maintain. The neos offer up to 500 nautical miles (950 kilometers) longer range, or up to two tons heavier payload for any given range.

President Hollande emphasized the importance of the sale stating that this should inspire the economies of France and the rest of Europe. Airbus planes are made principally by three countries, France, Germany and Spain. Final assembly of the A320 is in France, while the final assembly of the A321 is in Germany. The CEOs of Airbus and Lion Air signed the contract during a ceremony at the Champs Elysee, the French presidential palace.

Lion Air, Indonesia’s Largest Airline

For Lion Air, this will be the first time that they will be ordering from Airbus. Their short and medium range jets are Boeing 737 series airplanes. The company has also recently ordered 5 Boeing 787-5 widebody super jumbo jets for their new long-haul airline Batik Air.

Lion Air started operations in 2000, after the Indonesian airline industry was deregulated. Since then it has become one of the fastest growing airlines in Southeast Asia. The low-cost carrier has a 45% market share of inter-island traffic in the world’s largest archipelago. It has flights to 70 destinations within Indonesia and Southeast Asia. Batik Air will be Lion Air’s long distance arm, and will be launched with the delivery of the Boeing 787 Dreamliners. Lion Air also has a regional airline subsidiary in Wings Air for which Lion has ordered 60 ATR-72 Turbo-prop airplanes.

The Lion Air A320neos will be configured for 180 passengers, while the A321 will have 236 passenger capacity. The first Airbus planes will be delivered in 2014.

In 2012, Lion Air also made the single largest order from Boeing when it ordered 230 planes. The order was for 201 Boeing 737 MAX 9 planes and 29 Boeing 737-900ER, with an option for another 150 planes.

More Airbus Sales

Besides the indonesian Lion Air sale, it has been a busy sales period for Airbus. On March 15, Turkish Airways ordered 25 A321 with current engine option jets, four A320neos, and 53 A321neos, with an option for another 35 A321neos.

This news was followed by Lufthansa’s firm order for 30 Airbus A320neos worth close to $3 billion. The deliveries to Lufthansa will start in October 2015. Lufthansa had also earlier ordered 2 A380 super jumbo jets. According to the German airline, the A380s will be for fleet regeneration.


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