A320 NEO Interest Starting to Rise

Updated- February 28th, 10:23 PM EST

There have been wild predictions lately about Airbus’ sales potential with the A320 NEO with one analyst predicting the plane maker could sell 1,000 of the re-engined A320 by the Paris Air Show in June.

While Airbus was quick to reel those predictions in a little bit, it now seems that the recently announced re-engined plane is starting to gain momentum after Brazilian carrier TAM announced today that it has signed a memorandum of understanding to purchase 22 A320 NEO’s as apart of a 32 aircraft order for the A320 family FlightGlobal reports.

With fuel prices on a rapid rise, airlines are looking for new ways to save cost and the A320 NEO, expected to be delivered in 2015, is the best answer so far as Boieng stays put with its current 737, electing to wait until later this year to decide what it plans to do with the 737 while implying it will offer a brand new plane that won’t be available until 2020.

The memorandum of understanding by TAM follows on the heels of news over the past few weeks that other airlines, notably Jetstar and AirAsia (who may defer its A320 order for the NEO), have been strongly considering the aircraft with Delta airlines suggesting it is looking at the re-engined narrow-body for its upcoming order which may include up to 200 narrow-body orders.

Update: The Associated Press reports that TAM’s order will include two Boeing 777-300ERs with a total list price of $3.2 billion for the order although airlines generally negotiate discounts from Boeing and Airbus.

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