'New Air' Engine Orders $900m

Fri May 07, 1999 6:03 am

New York's New Air Corporation Signs Engine Order 900Valued Up to $900 Million

New airline chooses International Aero Engines' V2500 engines

for Airbus fleet

A new low-fare carrier, temporarily named New Air, announced today it has signed a contract worth up to $900 million with International Aero Engines (IAE) for V2500 engines to equip its fleet of [Airbus Industri]e A320 family aircraft.

The airline recently announced it would acquire up to 82 of the new aircraft, if all options are exercised, valued in excess of $4 billion.

New Air has placed firm orders for 25 aircraft, scheduled for delivery from June 2000. The value of the firm business for IAE is $300 million.

David Neeleman, Chief Executive of New Air, said: "Choosing the airframe/engine combination for a new airline is a critical decision that can have a long-term impact on the future of an airline. We chose the V2500 because of its industry leading performance and reliability and look forward to developing our strategic relationship with IAE."

Mike Field, IAE's Senior Vice President of Sales, said: "Winning this business from New Air is a notable success for the V2500. We are proud to have earned the confidence of the management team at New Air, and will demonstrate over the coming years that confidence is well placed."

New Air is expected to commence service this winter from New York's John F. Kennedy International Airport serving cities primarily along the East Coast, though final destinations have not yet been announced. The airline intends to unveil its new name within six weeks.

New Air Corporation is the most highly-capitalized new entrant in U.S. aviation history, having raised $130 million in equity capital investment. Based at John F. Kennedy International Airport, the airline filed a request with the United States Department of Transportation on February 5 for an exemption to the High Density Rule for service to and from JFK. On April 30, the airline filed for its Certificate of Public Convenience with the Department of Transportation. Both applications are pending. The airline has also initiated its certification process with the Federal Aviation Administration.

$130.m start-up cash, $300.M firm airbus orders, $900.M engine orders. I will thoroughly enjoy seeing this airline sink!!!