American Airlines Delays Purchase Of New Airbus A350 Aircraft Until Late 2018

American Airlines has announced that it will delay the purchase of their A350 wide body aircraft until late 2018, one year past the originally planned delivery.

American Airlines A330

The agreement reached with Airbus includes the first two A350 to be delivered in 2018 with five more p.a. until 2022 until the full delivery of 22 units is completed.

This moves comes as American is taking a more conservative position with their finances, having considered their growth plans and investor feedback.

You can find some more details about the decision at the Dallas Business Journal (access here).

American will delay its purchase of 22 Airbus A350 wide-body aircraft, said Derek Kerr, the company’s chief financial officer.

American and U.S. Airways each had their own fleet replacement plans before the airlines merged in 2013, so the delay will combine those plans, eliminate overlapping plane deliveries, and spread out American’s capital expenditures, Kerr said.

Under the new agreement, American will take ownership of the first two aircraft in late 2018, rather than 2017, Kerr said, then get five planes each year from 2019 through 2022.

“This change reduces cap-ex by approximately $500 million in 2017 and approximately $700 million in 2018, and provides us with capacity and flexibility,” he said.

What this means for American Airlines passengers is that they will be flying older planes on long haul routes for longer than anticipated. While many aircraft are already equipped with new AA cabin interior such as the new Business Class, others are still rather antique and at least one generation behind their competition even compared to North American carriers like Delta and United.

Conclusion

While fiscally responsible American Airlines management also has to consider the impact it has on their customer base. The A350 aircraft were announced in a loud fanfare, outlining all the benefits for travelers. Now customers have to wait at least another 2.5 years until just two A350 planes are in service while flying mostly old long, non-refurbished haul aircraft.

American will start to sell Premium Economy Class on their Boeing 787-9 Dreamliner starting in early 2017. In the meanwhile they will likely have to invest in more retrofit cabins which are already rolled out for the Boeing 777-200 and 767-300 aircraft. AA has drastically improved the quality of their aircraft and age of the entire fleet in the last few years. It would be a shame if they fall back to their old ways.

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