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Wednesday, March 20, 2013

Airbus and Lion Air strike record deal



Multibillion-euro order for 234 jets will secure 5,000 jobs over 10 years, says French president at Elysée Palace signing ceremony

Airbus deal with Lion Air. Fabrice Brégier, Rusdi Kirana, Francois Hollande
Airbus deal – French president François Hollande is flanked by Lion Air chief executive Rusdi Kirana, left, and his Airbus counterpart, Fabrice Brégier. Photograph: AP
Airbus has grabbed a record order worth €18bn (£16bn) at list prices from Indonesian budget carrier Lion Air, loosening Boeing's grip on one of the world's fastest-growing airlines.
The order for 234 medium-haul jets underscored the rise of a powerful new breed of Asian carrier and was immediately hailed for its impact on European jobs. "Thanks to this contract, Airbus will be able to secure 5,000 jobs over 10 years," the French president, François Hollande, said at an elaborate signing ceremony at the Elysée Palace.
Hollande, whose approval ratings have sunk to about 30% amid worries about unemployment, oversaw the deal before leaving for talks with the German chancellor, Angela Merkel, on further industrial co-operation modelled on Europe's plane maker.
The contract trumped a deal Lion Air had struck with Airbus's US rival Boeing in front of President Barack Obama in 2011.
The plane makers are locked in a battle for global orders in the 150-seat category estimated at $2tn over 20 years.
Lion Air has been rapidly expanding its fleet to meet the need for medium-haul jets in the world's fourth most populous country. Its co-founder, Rusdi Kirana, said he would use the aircraft to start up new airline ventures underpinned by Asia's growth. He also told Reuters in an interview that Indonesia's top domestic airline would aim for a stock market listing in 2015 after ditching the plan due to market volatility a year ago.
"What will I do with them? I will set up new airlines in other countries, in the Asia-Pacific region," Kirana said.
He dismissed concerns about Asia's ability to absorb large quantities of new aircraft such as over 200 Boeings already ordered by Lion Air and hundreds of Airbus aircraft destined for Malaysian rival AirAsia.
"People who say that don't understand the market in Asia," he said. He also rejected industry speculation that newly ordered planes would be used to set up a leasing business.

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