MONTREAL, May 5 (Reuters) – Airbus plans to announce an order on Wednesday for about 150 A220 jets from AirAsia, in a boost for the planemaker’s smallest jetliner that has recently lost orders to Brazil’s Embraer, two sources told Reuters.
The province of Quebec has a minority stake in the A220 program, which is produced at a site in Mirabel, north of Montreal, and at a separate assembly line in Mobile, Alabama. A220 planes for non-U.S. customers are produced in Mirabel.
Canadian Prime Minister Mark Carney is expected to attend the announcement in the Montreal area, the sources said on condition of anonymity as the matter is private. Airbus’ Canadian division and a spokesperson for Carney declined to comment on the order and the event, which could change or be delayed.
Malaysia-based AirAsia could not be immediately reached outside normal business hours.
News of a major A220 order from AirAsia was reported earlier on Tuesday by French-language publication La Presse and on Monday by Bloomberg. Reuters reported in February that a significant AirAsia order for the 110-to-130-seat A220 was expected, citing sources who said a deal could include 150 firm plane orders.
AIRBUS AIMS TO BREAK EVEN ON A220
The deal is good news for the A220, whose rival, Embraer’s E2, won a campaign with Finnair in March, and outsold the Airbus A220 three-to-one last year.
Airbus is trying to ramp up A220 production so it can break even on the money-losing program it essentially took for free from Canadian planemaker Bombardier in 2018.
The world’s largest planemaker has said it aims to assemble 12 A220 jets a month in 2026, down from a previous target of 14, blaming supply concerns and airlines waiting for upgraded engines.
Canada’s aerospace industry has been less damaged than other sectors, such as autos, by a trade war with the country’s largest partner, the United States. Washington exempts aerospace imports from tariffs.
AirAsia has led a boom in low-cost carriers in the region in the past two decades as incomes have risen. The carrier is one of the European planemaker’s biggest customers with more than 350 larger A320-family jets already on order.
AirAsia Co-founder Tony Fernandes had previously told Reuters the airline was ready to broaden its fleet by picking smaller planes to support new destinations.
It comes as turbulence from high jet fuel prices due to the U.S.-Israeli war with Iran has led airlines to cut flights.
(Reporting By Allison Lampert in MontrealEditing by Rod Nickel)
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