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Qantas to switch domestic fleet to Airbus in blow to Boeing

A crew member walks from a Qantas plane at a domestic terminal at Sydney Airport in Sydney, Australia, November 16, 2020. (Reuters photo)

Australia's Qantas Airways Ltd announced Thursday it has switched from Boeing Co. to Airbus SE as its preferred supplier to replace its domestic fleet.

The airline said it had committed to purchasing 20 Airbus A321XLR planes and 20 A220-300 jets with a list price of at least $4.6 billion before discounts and had considered buying another 94 aircraft.

The European planemaker’s domination of the deal struck a blow to a resurgent Boeing Co. and its 737 Max just as the US planemaker charts an exit from its worst-ever crisis.

The agreement, which is expected by June 2022, is subject to board approval after negotiations with pilots and finalizing the business case.

According to Qantas, deliveries would begin in mid-2023 and continue for the next 10 years during which an ageing fleet of 75 Boeing 737s and 20 717s will be replaced. The company added that the new planes would also lower its carbon emissions.

"This is a clear sign of our confidence in the future and we've locked in pricing ahead of what is likely to be a big uptick in demand for next-generation narrowbody aircraft," Qantas Chief Executive Alan Joyce said.

It caps a successful week for Airbus after it also landed a commitment from Singapore Airlines Ltd. for its A350 freighter Wednesday and an opportunity it has come across to seize a narrowbody order from Air France-KLM, which is set to announce replacements for its aging Boeing 737s.

Qantas has operated Boeing jets since 1959 and was once the world's only airline with an all 747 fleet.

The American company has been pushing the 737 Max after the plane was cleared to fly again in the wake of two crashes in Indonesia and Ethiopia in late 2018 and early 2019 which killed 346 people and led to the jet’s worldwide grounding.

Securing Qantas, which is famed for its safety record in the jet era, as a Max buyer would have been a further step toward the aircraft’s rehabilitation.

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