China Eastern Airlines said in a statement that the 101 A320 Neo aircraft are scheduled for delivery from 2028 to 2032 and will help modernise its fleet and support its growth strategy.
The statement said the $15.8bn figure is based on Airbus’s latest catalogue price. “Airbus SAS has granted to the Company substantive price concessions with regard to this batch of Aircraft,” China Eastern said, adding that the discount is “significantly lower than the catalogue price” without naming a figure.
It said the price concessions were similar to previous transactions with Airbus and that the latest transaction will not have a material impact on the airline’s future operating costs.
China Eastern explained that the deal comes with a price fluctuation mechanism that is designed to reflect the impact of inflation on the cost making the aircraft reflecting their long delivery cycle.
The purchase will be funded with a combination of own funds, loans from commercial banks, and proceeds from the issuance of bonds and other financing instruments with payments made in instalments in US dollars.
Delivery of the aircraft will be made in batches with nine set to arrive in 2028, 19 in 2029, 30 in 2030, 27 in 2031, and 16 in 2032. The delivery schedule and specific aircraft models may be adjusted depending on market conditions and future capacity requirements. Various news reports suggest the total order will include the A321neo and A321XLR models.
During that period, China Eastern expects to retire at least 53 A320 series aircraft due to their age and lease maturities.
The Chinese government is the main shareholder in China Eastern and it is one of the country’s three largest carriers. Chinese airlines had previously indicated that they were going to purchase more European made aircraft.
German Chancellor Friedrich Merz said during talks with President Xi Jinping in February that China had agreed to purchase up to 120 additional Airbus aircraft, though no timeline for the orders was disclosed.
The company said the new aircraft will support its strategy of “flying further, flying internationally, flying to emerging markets.” The firm is currently prioritising the development of a hub system based around Shanghai and complemented by a series of international hubs and key regional hubs.
For Airbus the sale represents another victory following a string of earlier orders from Chinese airlines such as the sale of 60 A320Neos to Air China for $9.5bn at list prices with deliveries take place from 2028 to 2032.