SHANGHAI- China Eastern Airlines (MU) plans to purchase 25 Airbus A330neo aircraft at a catalogue value of approximately US$9.35 billion to expand its widebody fleet and support growing international operations.
The airline will primarily deploy the aircraft from Shanghai Pudong International Airport (PVG) to increase long haul connectivity.
The aircraft will be delivered in batches between 2029 and 2033 under a purchase agreement signed in Shanghai.
China Eastern said in a filing to the Shanghai Stock Exchange that the final transaction value will be lower than the catalogue price after securing favourable commercial discounts.
China Eastern Orders 25 Airbus A330neo
China Eastern signed the purchase agreement with Airbus in Shanghai on Friday as part of its long term fleet expansion strategy.
The airline said the 25 Airbus A330neo aircraft will strengthen its widebody fleet to meet increasing demand for international travel and improve capacity on long haul routes.
The airline stated that the catalogue value of approximately US$9.35 billion is based on Airbus’ January 2025 list prices.
However, the actual purchase price will be lower because China Eastern negotiated discounts that are more favourable than those received in previous Airbus purchases. Large discounts are standard industry practice for airlines placing sizeable aircraft orders.
China Eastern said the new A330neo aircraft will primarily operate from Shanghai Pudong International Airport to expand its intercontinental network and increase flight frequencies on existing international routes.
The additional aircraft will also strengthen Shanghai Pudong’s role as a transfer hub for long haul travel by improving connectivity between China and overseas destinations.
Earlier Airbus Agreement
The latest purchase comes months after China Eastern signed a separate agreement in March to acquire 101 Airbus A320neo aircraft with a catalogue value of approximately US$15.8 billion.
The airline’s latest investment reflects a broader strategy among major Chinese airlines, which have identified renewed international expansion as an important driver of future growth following the recovery in global air travel.
According to Reuters, Airbus has held on and off negotiations in recent years to secure a potential aircraft order of up to 500 jets in China.
Such large agreements are often linked to state visits, although no deal was announced during French President Emmanuel Macron’s visit to China in December.
The new agreement also supports Airbus’ efforts to expand its presence in China, the world’s second largest aviation market.
The European aircraft manufacturer expects passenger traffic in China to grow by around 5 percent annually over the next 2 decades, supporting continued demand for new commercial aircraft.
A330neo Offers Greater Fuel Efficiency
The Airbus A330neo is the latest version of the A330 family and incorporates high aspect ratio wings, improved aerodynamics, and Rolls-Royce Trent 7000 engines.
These enhancements improve fuel efficiency and operating performance compared with the previous generation A330 aircraft.
China Eastern expects at least 10 of its older Airbus A330 aircraft to retire because of age during the delivery period.
As a result, part of the new order will replace aging aircraft, while the remaining additions will expand the airline’s long haul fleet.
Financing Structure and Overseas Bond Plan
China Eastern said it will finance the aircraft acquisition through a combination of internal capital, bank loans, bond issuances, and other financing instruments.
The airline added that the phased payment schedule is not expected to have a material impact on its cash flow or daily operations.
In a separate filing, China Eastern announced that one of its offshore subsidiaries plans to issue overseas bonds worth up to 2.8 billion yuan, equivalent to approximately US$411.89 million.
The airline did not specify how the proceeds from the bond issuance will be used.
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