American Airlines on Wednesday evening filed a motion in U.S.
Bankruptcy Court that seeks approval to proceed with its purchase of
Boeing and Airbus airplanes.
In the 20-page document, American indicates that Airbus has given it better terms than when the airline first announced the airplane deals in July 2011.
It sounds pretty good. But the good parts are all redacted. Here’s what is in the public version:
In the July 2011 order, American and Airbus said American would buy 130 airplanes from the current Airbus A320 family through 2017, and 130 of the next-generation A320neo airplanes beginning in 2017.
In Wednesday’s filing, American disclosed that it has options to buy more airplanes from the current-generation Airbus A320 family. How many? [Redacted]. It also has options to buy more of the Airbus A320neo family. How many and when? [Redacted and redacted].
The motion also asks for approval of the agreement between American and IAE International Aero Engines AG, which will supply engines for the Airbus aircraft. IAE is to pay a “fleet allowance” to American each time the carrier takes delivery of an Airbus airplane. The proposal would increase the fleet allowance, but the amount is [redacted].
In support of its request, American said “it is abundantly clear that assumption of the Airbus Agreement and IAE Agreement represents a sound exercise of the Debtors’ business judgment. The agreements are on extremely beneficial terms, very competitive in the industry and both agreements have been enhanced by the recent amendments. Moreover, assumption of the agreements will lock in the financial benefits, assure the timely delivery of aircraft critical to the Debtors’ fleet plan and income generating capacity and not impose any undue prejudice or burden on the Debtors’ estates or any party in interest.”
http://aviationblog.dallasnews.com
In the 20-page document, American indicates that Airbus has given it better terms than when the airline first announced the airplane deals in July 2011.
It sounds pretty good. But the good parts are all redacted. Here’s what is in the public version:
During the pendency of the chapter 11
cases, the Debtors have engaged in extensive discussions with each of
Airbus and IAE with respect to their respective prepetition agreements
and their ongoing relationship. These discussions have resulted in
proposed amendments and modifications to the prepetition agreements with
each of Airbus and IAE that would become effective upon the assumption
of the agreements, as so amended, pursuant to the provisions of the
Bankruptcy Code. These amendments and the benefits to the Debtors’
estates provided therein are summarized as follows:
Amendments to Airbus Agreements (the “Airbus Amendments”)
– Airbus provides a net reduction [redacted]. The total savings to be realized by American from this reduction is approximately [redacted] through [redacted];
— Airbus provides a reduction [redacted]; and
— Airbus has agreed to a reduction [redacted] which American projects will result in cost savings aggregating approximately [redacted] through [redacted].
Accordingly as set forth above, the savings that could be realized from the Airbus Amendments through [redacted] aggregate approximately [redacted], [redacted]. In addition, no cure amounts would be payable in connection with the assumption of the Airbus Agreements, [redacted].
That clears that up.In the July 2011 order, American and Airbus said American would buy 130 airplanes from the current Airbus A320 family through 2017, and 130 of the next-generation A320neo airplanes beginning in 2017.
In Wednesday’s filing, American disclosed that it has options to buy more airplanes from the current-generation Airbus A320 family. How many? [Redacted]. It also has options to buy more of the Airbus A320neo family. How many and when? [Redacted and redacted].
The motion also asks for approval of the agreement between American and IAE International Aero Engines AG, which will supply engines for the Airbus aircraft. IAE is to pay a “fleet allowance” to American each time the carrier takes delivery of an Airbus airplane. The proposal would increase the fleet allowance, but the amount is [redacted].
In support of its request, American said “it is abundantly clear that assumption of the Airbus Agreement and IAE Agreement represents a sound exercise of the Debtors’ business judgment. The agreements are on extremely beneficial terms, very competitive in the industry and both agreements have been enhanced by the recent amendments. Moreover, assumption of the agreements will lock in the financial benefits, assure the timely delivery of aircraft critical to the Debtors’ fleet plan and income generating capacity and not impose any undue prejudice or burden on the Debtors’ estates or any party in interest.”
http://aviationblog.dallasnews.com
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