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Abu Dhabi, UAEFriday 14 December 2018

Delta to order 100 Airbus A321neo in blow to Boeing

The second largest US airline expects deliveries to start in first quarter of 2020

Delta also said it now expects operating margin of 11 per cent for the fourth quarter, compared with the 11 per cent to 13 per cent it had previously forecast. Joshua Roberts/Reuters
Delta also said it now expects operating margin of 11 per cent for the fourth quarter, compared with the 11 per cent to 13 per cent it had previously forecast. Joshua Roberts/Reuters

Delta Air Lines said on Thursday it will place a firm order for 100 Airbus A321neo jets and an optional order for 100 of the aircraft.

Delta, the No 2 US airline by passenger traffic, said in a filing with the US Securities and Exchange Commission that it expects deliveries to begin in the first quarter of 2020, with new aircraft arriving through 2023.

CNN and Reuters reported yesterday that Airbus had beaten out rival Boeing Co for the order, boosting Airbus' leading share of the market for narrowbody models, while highlighting the increasingly fraught relationship between Delta and Chicago-based Boeing.

The two US companies' relationship began to fray in October when Boeing successfully lobbied the US Commerce Department to propose trade duties of nearly 300 per cent on Delta's order of CSeries jets from Canada's Bombardier.

The carrier declined to say whether the disagreement between the two planemakers had any effect on its decision to go with Airbus.

"This is the right transaction at the right time for our customers, our employees and our shareholders," chief executive Ed Bastian said in a statement.

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Delta's decision also gives lift to United Technologies subsidiary Pratt & Whitney, which the carrier said had won the contract for the engines that will power the A321neo aircraft.

In the same SEC filing, Delta also said it now expects operating margin of 11 per cent for the fourth quarter, compared with the 11 per cent to 13 per cent it had previously forecast.

Delta Air Lines' shares were up 2 per cent in premarket trading.

Up to Wednesday's close, Delta's stock had risen 9 per cent this year, compared with a 20.7 per cent increase in the Dow Jones US Travel & Leisure index.