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Abu Dhabi, UAESunday 21 October 2018

Greek carrier Aegean signs $5 billion order for Airbus A320 neo planes

Deal is largest order by a Greek carrier and third time Aegean has invested in new aircraft since launching 19 years ago

Airbus CEO Tom Enders makes a speech during the official signing of purchase agreement by Greek airline Aegean for an order of up to 42 A320neo jets, during a public ceremony at Athens International Airport on June 22, 2018. / AFP / Angelos CHRISTOFILOPOULOS
Airbus CEO Tom Enders makes a speech during the official signing of purchase agreement by Greek airline Aegean for an order of up to 42 A320neo jets, during a public ceremony at Athens International Airport on June 22, 2018. / AFP / Angelos CHRISTOFILOPOULOS

Greece's largest carrier Aegean Airlines signed a $5 billion deal with Airbus for up to 42 aircraft to renew its fleet of single-aisle planes, stay competitive and add capacity for future expansion.

It is the largest order by a Greek carrier and third time Aegean has invested in new aircraft since launching operations 19 years ago.

Seeking to reduce maintenance and fuel costs, Aegean, a member of the Star Alliance airline group, had been considering the Airbus A320neo or Boeing's 737 MAX. It picked Airbus in late March.

"I believe it is a good day for Greece with the news coming out of Brussels, but certainly a very good day for Aegean and Airbus," Airbus chief executive officer Tom Enders said at a signing ceremony at Aegean's technical base at Athens airport.

Earlier on Friday Greece reached an agreement with euro zone finance ministers, securing debt relief to smooth out its return to market financing after eight years of living mainly on loans from euro zone states.

"We begin a new cycle of growth while reducing our operating cost, necessary in a globalised and competitive market," said Dimitris Gerogiannis, Aegean's CEO, adding the order was for up to 42 planes, including 10 A321s.

Aegean, which flies domestic and international routes, also owns former flag carrier Olympic Airlines, which was privatized in 2013. Most of its current leases need to be replaced between 2019 and 2023.

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Last year, Aegean grew full-year net earnings by 87 per cent on an improved load factor and higher sales, riding a strong tourism year. In 2017 it flew a total of 13.2 million passengers.

While the new aircraft will offer 15 percent fuel savings, they are just the hardware, CEO Gerogiannis said. "It is the quality, culture and efficiency of our people that gives us our competitive advantage," he said.

Aegean executives said the carrier will also invest 30 million euros ($35m) to build a new 12,000 square metre facility in Athens for flight and cabin crew training.