) — Tolouse, France-based Airbus (AIR.PA
) will be manufacturing a whopping 430 units of its A320neo-line jets, after landing a deal wit U.S. investor Bill Franke, who will be upping his stake in budget airlines.
The deal, which will aim to increase the fleet strength of the four airlines in which Franke‘s Indigo Partners has ownership – Frontier Airlines, Volaris (Mexico), Wizz Air (Hungary) and carrier JetSmart (Chile)— is valued at $50 billion.
The deal was signed during the Dubai Airshow, among many others. The current landscape is ripe for dealmaking, as low demand for new aircrafts makes it possible for investors to negotiate competitive prices from the bigger brands in the sector.
Another significant deal worth mentioning is that made by flydubai, a budget airline, to the tune of around $21 billion per list prices. It will acquire 175 Boeing 737 Max jets.
The final agreement between Airbus and Franke is expected to be finalized in the upcoming weeks.
Both deals bring the spotlights towards how budget carriers are changing the landscape of air transportation, as they combine bargain fares with optional upgrades for passengers, for additional fees.
The Airbus deal also makes it possible for sales chief John Leahy to leave the company with a bang, as he‘s set to retired in the upcoming months – after over 23 years in the role.
Under Leahy‘s management, Airbus has sold jets for a list value of over $1.7 trillion, and had a hand in rising the company‘s market share from just 18% to a point where it could rival Boeing (BA
) as an equal. However, 2018 saw the balance tilt in favor of a rejuvenated Boeing, as their management made great strides in Singapore and other markets. The moves made Airbus‘ global market share drop to 35%.