By Tess Stynes
American Airlines Group Inc. (AAL) said it reached an agreement
to delay the purchase of a total of 35 Airbus A320 single-aisle
jetliners until 2021 through 2023.
In a regulatory filing, American, the largest U.S. airline by
traffic, said that as of March 15, it had agreements in place to
purchase 10 Airbus A320neo family aircraft in 2017 and 25 Airbus
A320neo family aircraft in 2018. Under the amended terms, American
will have no commitments to purchase A320s during those two years,
but has commitments to acquire 25 of the A320s in 2019 and a total
of 75 A320s starting in 2020.
Airbus Group SE (AIR.FR) and rival Boeing Co. (BA), the world's
largest plane makers, have enjoyed a period of record order intake
for new planes, principally their single-aisle jets, which have
seen demand fueled by the growth of low-cost carriers.
American, which merged with US Airways roughly a year and a half
ago, has been aiming to refresh the airline's aging fleet and keep
up with the competition, which is also spending big on new seats
and technology.
However, last week American lowered its outlook, while rival
Southwest Airlines Co. (LUV) limited its plans to add seats, the
latest signs of weakness in an industry swelling with profits but
surrounded by investor skittishness.
Analysts and investors have been concerned that low fuel prices
that have helped buoy profits in the sector could be outweighed by
airlines oversupplying the market--a practice that has damaged the
industry's profitability in past years.
Write to Tess Stynes at tess.stynes@wsj.com
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