Garuda Indonesia Orders 25 Airbus A320 Planes to Replace Boeing 737 Fleet

PT Garuda Indonesia ordered 25 Airbus SAS A320s, including 10 A320neos, as it replaces a fleet of Boeing Co. (BA) single-aisle aircraft at its low-cost unit. 

The contract, worth about $2.2 billion at list prices, also includes options for another 25 A320neo planes, Garuda Chief Financial Officer Elisa Lumbantoruan said by e-mail today. The Citilink unit, which operates five 737s, will receive the new Airbus aircraft from early 2014, he said. 

The deal builds momentum for the A320neo after Toulouse- based Airbus yesterday won 90 orders for the plane on the first day of the Paris Air Show. Boeing is deciding between joining Airbus in offering a revamped single-aisle aircraft with new engines and developing an all-new model. 

Garuda, Indonesia’s biggest carrier, picked the Airbus planes because of lower operating costs and because they were more quickly available than Boeing models, Lumbantoruan said. Slots for the 737 are sold out until 2016, Jim Albaugh, the head of Boeing’s commercial-plane unit, said in an interview yesterday. 

Airbus markets the A320neo as 15 percent more fuel efficient than current planes. Deliveries of the new aircraft are due to begin in 2015. 

Citilink also plans to add four leased Airbus A320s this year to support traffic growth that’s three times as fast as last year, Garuda said earlier this month. The unit flies to domestic cities including Jakarta, Surabaya and Denpasar.  Source: Bloomberg