United Airlines Inks Deal For 40 Leased Airbus A321neos

United Airlines has firmed up its preliminary agreements with aircraft lessors to add 40 Airbus A321neo aircraft in the next two to three years, with the airline continuing to look for alternatives to the Boeing 737 MAX 10.

Previously announced lease agreements

United Airlines’ Q3 United States Securities and Exchange Commission (SEC) filing read that the airline had finalized “definitive” agreements with aircraft lessors for 40 A231neo aircraft during the quarter.

Airbus should deliver the 40 aircraft out of the lessors’ backlogs between 2026 and 2027, according to the carrier’s filing.

The transactions were initially revealed in the airline’s Q2 SEC filing on July 18. Then, the airline said that it had signed letters of intent (LoI) with major aircraft leasing companies for 40 A321neo aircraft.

By July, the airline had finalized agreements for 35 out of 40 of these aircraft, the Q2 SEC filing read.

As of September 30, United Airlines had entered into leases with rental obligations of around $4 billion, with the sum covering “several” mainline aircraft, regional aircraft under capacity purchase agreements (CPA), airport facilities, and office space.

None of these leases had commenced before September 30, with these agreements starting between 2024 and 2027, with terms of up to 12 years, United Airlines said.

The carrier ended Q3 with revenues of $14.8 billion and a net income of $965 million. During the first nine months of 2024, United Airlines’ net profit was $2.1 billion, a slight increase compared to the same period a year prior.

Lessor confirming transaction

While United Airlines did not disclose the lessors from which it will lease the A321neos, at least one company has publicly announced its transaction with the US-based airline.

This included SMBC Aviation Capital, which announced that it had signed definitive agreements to lease 20 A321neo to United Airlines on September 19.

“The aircraft, previously announced as part of United’s fleet plan in April, are scheduled to deliver from 2026 and will come from SMBC Aviation Capital’s direct Airbus orderbook.”

Michael Leskinen, the chief financial officer (CFO) of United Airlines, said that the relationship between the airline and the lessor has never been stronger, adding that the A321neo leases were part of its efforts to optimize its balance sheet and increase its shareholders’ return on capital.

Looking for Boeing 737 MAX 10 alternatives

United Airlines has been forced to look for alternatives to the 737 MAX 10 as Boeing has continued to certify the type and its smaller brother, the 737 MAX 7.

With the 737 MAX 10 being similar in capacity to the A321neo, the airline turned to the latter as an alternative to the former.

Previously, United Airlines removed the 737 MAX 10 from its near-term fleet plan, with the airline now planning to welcome its first largest 737 MAX aircraft family member after 2025, which was also confirmed in its Q3 SEC filings.

The situation seemingly deteriorated after the Alaska Airlines mid-air door plug blowout in January, which has resulted in Boeing attempting to fix its quality assurance issues ever since.

During a J.P. Morgan Industrials Conference in March, Scott Kirby, the chief executive officer (CEO) of United Airlines, said that it was impossible to predict the certification of the 737 MAX 10, reiterating that the airline had been public about its intentions to replace the 737 MAX 10 with the A321neo, with the carrier looking for options in the market.

However, Kirby cautioned that the economics had to be right for United Airlines to finalize any potential agreements for additional A321neos.

Ch-aviation data showed that the airline has 15 A321neo aircraft in its fleet, all of which are owned by United Airlines and not aircraft lessors.

Still, the site’s fleet records indicated that at least 116 out of 972 mainline aircraft are owned by aircraft lessors.