Iran Air and Airbus have signed a firm contract including the sale of 100 Airbus jets, closing on a comprehensive civil aviation package outlined in January during a state visit by Iranian President Hassan Rouhani to Paris. The agreement covers 46 A320 family jets, 38 A330s and 16 A350 XWBs. It conspicuously excludes 12 A380s specified in the original deal, thereby significantly decreasing the transaction’s value, both monetarily and to the health of the superjumbo program as a whole. Airbus said deliveries will begin early next year.
Although the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) granted licenses for the deal in September and November, as required for any export of aircraft possessing more than 10 percent U.S. technology content, questions surrounding political environment and its potential effect on the deal remain as an incoming U.S. presidential administration openly critical of Barack Obama’s signature nuclear settlement with Iran prepares to take office next month.
In fact, Republican politicians in the U.S. Congress have pledged to block a separate deal between Boeing and Iran Air calling for delivery of fifty 737 Max 8s, fifteen 777-300ERs and fifteen 777-9s valued at $16.6 billion at list prices. In November the U.S. House of Representatives voted 234 to 174 for a bill prohibiting any U.S. transaction connected with the export of passenger airplanes to Iran. The bill would next need to pass the Senate, which, although Republican controlled, failed to pass an earlier bill this summer that would have blocked sales of commercial aircraft with more than 10 percent U.S. content. At the time President Barack Obama vowed to veto any such bill, but during the election campaign President-elect Donald Trump pledged to unilaterally abandon the nuclear deal with Iran when he takes office in January.
In any case, Airbus said it continues to act “in full compliance” with the conditions of the OFAC licenses, issued under the terms of the JCPOA (Joint Comprehensive Plan Of Action), more commonly known as the Iran nuclear accord. “Airbus coordinated closely with regulators in the EU, U.S. and elsewhere to ensure understanding and full compliance with the JCPOA,” said Airbus in a statement.
The JCPOA also allows for what Airbus calls a comprehensive civil aviation package, includes pilot and maintenance training, supporting the development of air navigation services, airport and aircraft operations and regulatory harmonization.
“This is a landmark agreement not only because it paves the way for Iran Air’s fleet renewal,” Airbus president and CEO Fabrice Bregier. “Our overall accord includes pilot training, airport operations and air traffic management so this agreement is also a significant first step in the overall modernization of Iran’s commercial aviation sector.”