MONTREAL, May 5 - Airbus plans to unveil an agreement on Wednesday for roughly 150 A220 jets from AirAsia, according to people familiar with the situation. The potential order would provide a significant lift to the planemaker's smallest airliner, which has recently lost business to Brazil's Embraer.
The A220 program has a minority equity stake held by the province of Quebec and is produced at an assembly site in Mirabel, north of Montreal, as well as at a separate final assembly line in Mobile, Alabama. Aircraft destined for non-U.S. customers are assembled in Mirabel.
Canadian Prime Minister Mark Carney is expected to attend an announcement in the Montreal area, the sources said on condition of anonymity because the matter remains private. Airbus' Canadian unit and a spokesperson for Carney declined to comment on both the potential order and the planned event. The sources cautioned the timing and details of the event could change or be delayed.
Malaysia-based AirAsia was not immediately reachable outside normal business hours for comment.
Reports of a large AirAsia commitment for the A220 surfaced in recent days. That follows earlier reporting suggesting a significant purchase was likely, with people cited at the time saying a deal might include 150 firm jets for the 110-to-130-seat A220 family.
A220 program context
The order would come at a critical moment for the A220. Embraer's re-engined E2 family has recently won campaigns such as a deal with Finnair in March, and Embraer's E2 narrowbodies outsold the A220 by three-to-one last year. Airbus is attempting to raise A220 output to reduce losses on the program it acquired from Canadian planemaker Bombardier in 2018 without a purchase price.
Airbus has said it aims to assemble 12 A220 jets per month in 2026, down from an earlier target of 14 per month. The company cites supply-chain concerns and airlines' decisions to wait for upgraded engines as reasons for the revised production target.
Industry and customer notes
Canada's aerospace sector has not been hit as hard as some other manufacturing industries by recent trade tensions with the United States, in part because Washington excludes aerospace imports from tariff measures.
AirAsia has been a major force in the growth of low-cost carriers across its region over the past two decades, and it already figures among Airbus' larger customers. The carrier has more than 350 larger A320-family jets on order from Airbus.
AirAsia's co-founder Tony Fernandes previously indicated the airline was prepared to add smaller types to its fleet to serve new destinations, a strategic rationale that aligns with taking on A220s. The aviation sector has faced turbulence from higher jet fuel prices linked to the U.S.-Israeli war with Iran, a factor that has prompted airlines to trim some services.
What this means for Airbus
A substantial order from AirAsia would bolster demand for the A220 and support Airbus' efforts to increase production rates and move the program toward financial break-even. The transaction, if confirmed, would also reinforce Airbus' position in the single-aisle market across both larger and smaller narrowbody segments.