(Adds context, background)
By Alexander Cornwell
DUBAI Jan 10 Airbus has finalised an
agreement to sell more than 60 jets to Saudi Arabian budget
carrier flynas, according to industry sources, a move that could
help the European planemaker keep ahead of Boeing in the annual
race for new orders.
The order from flynas, partly owned by Saudi billionaire
Prince al-Waleed bin Talal's investment vehicle, is expected to
cover over 60 A320neo narrow body jets, one of the sources with
direct knowledge of the deal told Reuters.
An order for 60 A320neos would be worth $6.4 billion at list
prices though it is common for manufacturers to grant discounts.
Including purchasing options, the agreement includes 100
A320neos, sources said.
The order could be announced as early as Wednesday at
Airbus' annual press conference so that it can be included in
the planemaker's 2016 sales numbers, though one source said the
buyer might not be identified.
The sources requested anonymity as the details were still
Airbus and flynas declined to comment.
The A320neo sale would be Airbus's first in the Middle East
since Qatar Airways refused deliveries in December 2015 and said
it would swap its order for a larger version.
Flynas, which launched as Nas Air in 2007 and first turned a
profit in 2015, has been negotiating an order for at least 60
narrow body jets with Airbus and rival planemaker Boeing
since as early as April 2016.
Flynas Chief Executive Paul Byrne said on April 27 whichever
manufacturer it chose would over time become the sole supplier.
The order, which would replace and expand a fleet of leased
A320s, would give flynas one of the largest Middle East low cost
fleets after state-owned flydubai, which operate 57 Boeing
737-800s and has more than 100 scheduled for delivery by 2023.
Flynas is facing increasing competition domestically, where
it conducts the majority of its operations. Start-up SaudiGulf
Airlines and Saudi-owned, Egypt-based Nesma airline were both
granted domestic operating licences in 2016, while state-owned
Saudi Arabian Airlines has announced plans for its own budget
carrier, Flyadeal, to launch in mid-2017 with a target of 50
jets by 2020.
Qatar Airways-owned Al Maha is waiting for a domestic Saudi
Saudi Arabia wants to expand its aviation and tourism
sectors following the success of its Gulf neighbours Qatar and
the United Arab Emirates. It plans to encourage non-religious
tourism as part of major national reforms aimed at moving the
country's economy away from oil dependence.
(Reporting Alexander Cornwell in Dubai; Additional reporting by
Tim Hepher in Paris; Editing by Susan Fenton and Mark Potter)