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easyJet in talks with Airbus for $10 billion order

The deal would include orders for about 100A320neo aircraft with an option for an additional 120 airliners, which will mark the carrier's first largest order in more than a decade, according to the sources familiar with the matter.

Featuring large Sharklet wing-tip devices, the A320neo will provide a double-digit reduction in NOx emissions and reduce engine noise, according to Airbus.

In addition, it will have more than 95% airframe commonality, making it easily integrated with existing fleets, while offering a further 500 nautical miles in range or two tonnes extra payload.

The A320neo is scheduled to enter service from late-2015.

easyJet recently completed the technical evaluation of tenders from Airbus and Boeing, over its decision on the re-engined Airbus A320neo and Boeing 737 MAX, and then moved to a commercial evaluation stage, which is still ongoing.

The airline is expected to make an announcement on the order as early as this week to coincide with the Paris Air Show at Le Bourget, the sources said.

The deal would require approval from easyJet shareholders.

Stelios Haji-Ioannou, who established easyJet in 1995 and remains its largest shareholder with a 37% stake, said that the purchase of new aeroplanes would hit shareholder value, and instead the money could be spent on improving returns to investors through dividends or share buybacks.

Mr Haji-Ioannou is seeking to replace easyJet's ageing fleet of A319s, which constitute about three quarters of the carrier's fleet, with cost-effective and fuel-efficient 180-seat jetliners.

easyJet started operations in 1995 with Boeing aircraft; however, the airline shifted to Airbus airliners in 2002 when it placed an order for 120 A319s with options for a further 120 jets.