Delta will wait for new planes to prove themselves: CEO
By Karen Jacobs
(Reuters) - U.S. carrier Delta Air Lines will watch the wave of orders for the latest Airbus and Boeing planes roll on by and wait for the jets to prove themselves before ordering any, its chief executive told Reuters on Wednesday.
The two airplane makers have orders for more than 3,000 of their narrow-bodied models, the Boeing 737 MAX and the Airbus A320neo, which boast fuel savings of about 15 percent. The new models are to be in service from the second half of the decade.
"We'd rather get toward the end of a production line because one, the airplane has probably been stretched, and stretched economics are always better than the original economics," the airline's Chief Executive Officer Richard Anderson told Reuters reporters and editors at Reuters New York headquarters.
Jumping in at the back of the line for a new model allows time for technical difficulties to be resolved, he said.
"Our ideal solution for buying airplanes is to compete Boeing against Airbus against used airplanes; compete GE (GE.N: Quote) against Pratt (UTX.N: Quote) and Rolls-Royce (RR.L: Quote) so that we always have multiple engine manufacturers and multiple airframe manufacturers at the table," Anderson said. (For a look at Delta's business performance, click link.reuters.com/tar38t)
In 2011, Delta ordered 100 Boeing 737-900ER models due to be delivered starting later this year, but it has not bought either the Boeing 737 MAX or the Airbus A320neo.
Rival U.S. airlines such as United Continental Holdings (UAL.N: Quote) and AMR Corp's AAMRQ.PK American Airlines, which plans to merge with US Airways Group LCC.N this year and form the world's biggest carrier, have already placed orders for the re-engineered jets that are due for delivery over the next few years.
Anderson said Delta's deal with Boeing allowed it to convert the last 40 of the 737-900ER aircraft it has on order to the newer MAX model. Continued...