Airbus, the European aircraft maker, yesterday defeated Boeing of the US to win a fiercely contested order for 120 aircraft from EasyJet, Europe's leading low-cost airline. It is the biggest aircraft contract placed this year.
Airbus granted EasyJet a discount of around 50 per cent off the $6 billion (€6.08 billion) list price, according to people close to the negotiations, in one of the keenest aircraft deals ever made.
It reflects the severely depressed state of the aircraft market, where orders and deliveries have plunged this year and airlines are suffering losses of several billion dollars.
"It surprised all of us to see just how aggressive Airbus was in the final round of sealed bids," said Mr Ray Webster, EasyJet chief executive.
The airline has reached agreement in principle to place firm orders for 120 Airbus A319s for delivery between September 2003 and the end of 2007. Airbus has a 45-day period of exclusivity to finalise the deal.
EasyJet has taken options at protected prices on a further 120 A319s for delivery up to 2012.
Mr Stelios Haji-Ioannou, founder of EasyJet who is to leave as chairman next month, said the price difference between the bids left the company with no choice:
"The difference was so substantial we would have been in breach of our fiduciary duty; it would have been an offence to buy Boeing."
Mr Noel Forgeard, Airbus chief executive, insisted, however, that the deal would be "profitable". - (Financial Times Service)
