American Airlines sale-leaseback deal 35 B737-800 aircraft

American Airlines announced Friday it has an agreement with AerCap to sell 35 Boeing 737-800 airplanes to the Dutch aircraft leasing company and then lease them back.

This isn’t the big order that’s looming out there. However, it does add nine airplanes to American’s order book with Boeing, either as firm orders or purchase rights.

American said the deal covers 26 jets it had previously ordered and three additional jets on firm order, plus purchase rights for six more Boeing 737-800s for delivery in 2013-2014.

“We are pleased to significantly expand our relationship with AerCap and diversify our financing strategies,” AMR chief financial officer Bella Goren said. “This arrangement is a great reflection of the flexibility we have to efficiently raise capital in support of AMR’s strategic fleet renewal efforts.”

“With this major aircraft transaction we will deepen our relationship with one of the world’s leading airlines,” AerCap chief executive officer Aengus Kelly said. “Furthermore, this transaction will materially increase the number of Boeing 737-800 aircraft in our portfolio, one of the most in-demand and fuel-efficient aircraft in the world.”

American is replacing its 140-seat McDonnell Douglas MD-80s with 160-seat Boeing 737-800s, a much more fuel efficient airplane. As of March 31, American operated 219 MD-80s to 152 737-800s. But by sometime next year, the number of 737s will exceed the number of MD-80s as more Boeings arrive and more MD-80s are parked.

The bigger question out there, however, is what American plans to do long-term with its narrow-body fleet. Bloomberg and the Wall Street Journal have reported that American is talking to Airbus and Boeing about a massive order of narrow-body airplanes to replace not only the MD-80s but the 188-seat Boeing 757s.

Airbus has picked up a bunch of orders for the Airbus A320neo, a new version of that family with a more efficient engine than current A320s. It’s supposed to begin arriving in late 2015.

Meanwhile, Boeing has been pondering whether to go the neo route and re-engineer the current 737s for a new engine, or go the more drastic route with a potentially big payoff – an all new replacement for the current 737 and the 757.

The WSJ suggested that we may hear something when AMR, American’s parent, announces second quarter financial results Wednesday, July 20.


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