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United Signs Airbus Deal in Blow to Boeing : Airlines: The carrier says it will lease 50 of the European-built planes. Deal is worth an estimated $2.4 billion.

From Reuters

United Airlines said Wednesday that it will lease 50 aircraft from Airbus Industrie, the first time the carrier has done a deal with the European aircraft group.

Industry analysts said the deal pushes aside Boeing Co., the world’s largest plane manufacturer and the main supplier to United, and gives Airbus another foothold in the United States.

They estimated that the deal is worth $2.4 billion to Airbus. The list price for the A320 is put at $45 million by industry sources.

United agreed to lease 50 A320s from Airbus, with options for an additional 50 aircraft.

United, a subsidiary of UAL Corp., said it plans to take delivery of its first A320 in November, 1993.

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Two weeks ago, Airbus and Boeing, which has been United’s exclusive supplier, were reported to be in hot contention for the order. Boeing had been widely expected to win the business. Analysts said they presumed that Airbus clinched the deal by offering attractive financing.

A UAL official confirmed that cost was a major consideration.

“The financing was attractive to us,” UAL spokesman Joseph Hopkins said.

Analysts said they did not know how profitable the order will be for Airbus, but said it had strategic benefits for the four-nation aerospace consortium.

“It’s a strategic order because it pretty much completes their penetration of all the major U.S. airlines,” UBS Securities analyst Wolfgang Demisch said.

American Airlines, America West, Continental Airlines, Delta Air Lines, Federal Express, Northwest Airlines and TWA operate Airbus aircraft or have them on order.

Airbus is owned by government-backed companies in France, Germany, Britain and Spain.

Airbus A320s, with a range of up to 3,000 miles, will be used on domestic routes in the United States, UAL’s Hopkins said.

Boeing was not immediately available for comment.

Shares of Boeing stock fell after the announcement by United, its largest U.S. customer. Boeing fell 87.5 cents to $40.375 on the New York Stock Exchange.

UAL lost $2.75 to $114.75.


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