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Turkish carriers are a few of the best performing airlines right now, which puts Airbus in the profitable position of delivering on future aircraft orders.
Airbus SAS said Turkish low-cost carrier Pegasus Airlines agreed to buy 75 A320neo series single- aisle jetliners, with options for 25 more. The carrier has previously operated mainly 737 planes from Boeing Co.
The deal is valued at $12 billion if all options are exercised, Airbus said in a statement. Pegasus has firmly committed to buy 58 A320neos and 17 larger A321neos.
Airbus’s order with Istanbul-based Pegasus Havayollari AS is the first for the reengined neo in the fast-growing Turkish market. Deliveries will begin in three years and run through 2022, Chris Buckley, the manufacturer’s executive vice president for Europe, Asia and the Pacific, said in an interview.
The order increases Airbus’s backlog of A320neo single- aisle aircraft to 1,654 since sales began two years ago. Deliveries of the model are planned to begin in 2015.
Turkish carriers have been adding overseas routes and raising capacity on domestic flights as demand for travel grows. That’s led to higher earnings even as airlines elsewhere suffer a slump in business during the global economic slowdown.
Pegasus, Turkey’s largest airline after state owned Turk Hava Yollari AO, or Turkish Airlines, operates a fleet of 42 aircraft and is planning an initial public offering in 2013.
The A320s will be configured in all-economy layout featuring 180 seats, with 220 on the A321s, and used on routes in Europe and the Middle East, Pegasus said.
A decision on engines will be made by the end of February and may determine the date of the first delivery, Pegasus Chief Executive Officer Sertac Haybat said in an interview. The neo comes with turbines from United Technologies Corp.’s Pratt & Whitney, available from 2015, or CFM International, a venture between General Electric Co. and Safran SA., due 2016.
Pegasus, owned by Esas Holding AS, which has investments in the health-care, retail, food and real estate sectors, did not immediately specify who the engine provider will be.
The Turkish company, based at Sabiha Gokcen airport on the Asian side of Istanbul, transformed into a discount carrier from a charter operator in 2005 following its purchase by Esas. It currently serves 24 domestic destinations and 38 overseas routes and carried 11.3 million passengers in 2011.
The European manufacturer has been working with Pegasus for a decade and the deal announced today stems from its third attempt to sell planes to the carrier, Buckley said.
With assistance from Andrea Rothman in Toulouse, France. Editors: Chris Jasper, Chad Thomas.
To contact the reporters on this story: Ercan Ersoy in Istanbul at firstname.lastname@example.org; Robert Wall in London at email@example.com. To contact the editor responsible for this story: Benedikt Kammel at firstname.lastname@example.org; Chad Thomas at email@example.com.