Air New Zealand confirms Airbus order

<p>Airbus will be providing 13 new aircraft to Air New Zealand.</p>

The share price of Airbus is up this morning (June 2nd) on the back of Air New Zealand announcing it has placed a major order for new aircraft from the manufacturer.

Air New Zealand stated that it has bought 13 new planes from the firm, with the news revealed by the airline's chief Christopher Luxon, who was speaking at an industry conference in Doha.

He announced that ten A320neo, one A320 and three A321 aircraft have been ordered by the airline, with the planes having a combined list price of about $1.5 billion (£1.1 billion). However, the terms of the deal have not been announced by either party and it is typical for aircraft manufacturers to give airlines a significant discount when purchasing multiple planes.

Mr Luxon said: "This new fleet will further enhance the experience for our customers and will drive fuel efficiency enabling us to minimise our carbon footprint by saving around 3,600 tonnes of CO2 per aircraft per year."

Replaced planes

The purchase of the new aircraft from Airbus means that Air New Zealand will be replacing its current fleet of 13 international short-haul A320s, but the planes are not likely to be delivered by the manufacturer until between 2017 and 2019.

On the back of the announcement of the Air New Zealand order, the share price of Airbus rose by a significant amount on the Paris Stock Exchange in the early stages of the new week's trading. By 08:28 BST, stocks in the aircraft manufacturer were up by 1.6 per cent compared to the start of the day as investors responded strongly to news of the order from Air New Zealand.

Airbus is locked in a battle for business with its main rival in the aircraft manufacturing sector, Boeing. The two companies compete fiercely for orders from airlines and each one secured represents a boost not just for their own business, but a blow to the rival firm as well.

Find up to date information on the FTSE 100 and spread betting strategies at City Index

Build your confidence risk free
Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.