AirAsia Orders $8.6 Billion CFM Engines for A320 Planes

AirAsia Bhd. (AIRA), the region’s biggest budget carrier, selected an engine venture between General Electric Co. (GE) and Safran SA (SAF) to power 100 new planes it ordered in December.

The order for CFM International engines is valued at $8.6 billion at list prices, Sepang, Malaysia-based AirAsia said in an e-mailed statement yesterday. The airline already operates more than 120 Airbus A320s powered by the venture’s products.

AirAsia, Airbus’s biggest customer for single-aisle planes in Asia, has ordered more than 300 aircraft since 2011 as economic growth spurs travel demand in the region. Some 15 low-fare carriers started flying in the past decade across Asia-Pacific, the most profitable region worldwide for at least the fourth consecutive year, according to the International Air Transport Association.

AirAsia’s deal also includes a 20-year agreement that CFM will guarantee maintenance costs on a dollar per engine flight hour basis, according to the statement.

AirAsia’s order in December included 36 current-generation A320s and 64 fuel-efficient A320neos.

To contact the reporter on this story: Kyunghee Park in Singapore at kpark3@bloomberg.net

To contact the editor responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net

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