Delta Makes Second Major Airplane Order in Two Days
Delta Air Lines has announced its second major airplane order in the last two days. Just a day after it made 75 firm orders with Canadian manufacturer Bombardier, the Atlanta-based carrier announced that it would also be purchasing 37 Airbus A321s.
Delta is still awaiting delivery of A321s from a previous order with Airbus. Once all the planes are delivered, the carrier will have 82 A321s in its fleet.
The first of the Airbuses was delivered last month. It is currently in a Delta hangar, but will soon take to the skies. The plane is scheduled to begin flying between Atlanta and Orlando on Monday, May 2.
Delta CEO Ed Bastian explained that aircraft from the A320 family perform very well when it comes to operating costs. He also noted that the airline wanted to speed up the process of retiring its aging MD-88s, which now make up a large part of its narrow-body fleet. “The Airbus A320 family of aircraft continues to be a cost-efficient, reliable and customer-pleasing mainstay of our narrow body fleet. The order for the A321s is an opportunistic fleet move that enables us to produce strong returns and cost-effectively accelerate the retirement of Delta’s 116 MD-88s in a capital efficient manner.”
This was a very cost-savvy move for Delta. The airline decided to forego the new A320 and A321neos. Instead it opted for the older models, which are now near the end of their production cycle. This allowed Delta to get the planes at a discounted rate. Even though they are not going to be flying the ultra-efficient neos, Delta will still see much lower costs with the A321s compared to its current MD-88s.
Another positive, from Delta’s standpoint, is that it won’t have to deal with the ongoing problems that other airlines are experiencing with the A320neos. The older A320-A321 models have proven very reliable and are widely used by carriers all over the world.
The A321s will be taking to the skies soon, but Delta passengers will have to wait a little bit longer to ride in one of the new state-of-the-art Bombardier CS100s. These newly ordered aircraft probably won’t be used on commercial flights until early 2018.
These two large orders show that Delta is trying to stay ahead of its competitors by reinvesting its profits in upgrading its fleet. Passengers will probably appreciate the state-of-the-art CS100s, and shareholders will be impressed by the efficiency and low operating costs of the A321s.
So it seems like Delta will come out ahead after the planes from these back-to-back deals start being delivered.
More by Josh Lew
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