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Last Updated: Monday, 12 April, 2004, 11:21 GMT 12:21 UK
Airbus wins $1.2bn China order
Airbus A320
Fifteen of the aircraft will be Airbus A320s
China Southern Airlines said it has agreed to buy 21 planes from European plane-maker Airbus in a deal worth about $1.2bn (654m).

China Southern will take 15 A320-200s and six A319-100s under an agreement signed by its president Yan Zhiqing and Laurence Barron, head of Airbus China.

The planes will be delivered in 2005 and 2006.

Airbus has been pushing to increase its market share in China at the expense of its rival, Boeing.

Battle with Boeing

China Southern is one of China's bigger airlines, with a fleet of 125 planes, mainly Boeings, serving 80 domestic and international destinations.

Airbus says it has a third of China's aviation industry but wants to increase that slice to 50% over the coming decades.

The deal will improve the capability of the company, provide better services for travellers and improve the company's competitiveness
China Southern
"This is the first major deal we have signed in China this year, following a bulk order of 30 planes by five Chinese airlines last April," said an Airbus spokesman in China Gu Ming.

The aircraft cost between $50m and $61m each. China Southern said it would pay for the planes using bank loans.

"The deal will improve the capability of the company, provide better services for travellers and improve the company's competitiveness," the company said in a statement.

But a China Southern spokesman said the new order did not mean the firm would drop Boeing as a supplier.

China Southern has signed up to buy seven Boeing 737 aircraft and a B-747 freighter this year, the spokesman said.

Airbus said the planes will be powered by CFM56-5 engines from CFMI, a joint venture between Snecma of France and the US's General Electric.

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