JetBlue founder David Neeleman explains why TAP ordered Airbus A330neo

TAP’s first Airbus A330neo.
Airbus

• The Airbus A330neo is expected to enter
  service later this year with launch customer TAP Air Portugal.
• Airbus has struggled to find buyers for the
  next-generation variant of its workhorse A330
  airliner.
• TAP co-owner and JetBlue founder David Neeleman told
  Business Insider that the plane’s price, performance, and
  cockpit commonality with other Airbus products sealed the deal
  for the A330neo. 
• The Airbus A330-900neo lists for $296.4
  million. 

The Airbus A330neo is Europe’s answer
to the Boeing 787 Dreamliner. Like the Dreamliner, it’s a
ready-made replacement for the aging Boeing 767 and older Airbus models likes the
A330ceo and A340. But unlike the Boeing 787, the A330neo has not had the sales
success of its US rival with just 224 orders on the books. In
comparison, Boeing has taken nearly 1,400 orders for the
Dreamliner. 

Launched in 2014, the A330neo is a next-generation development of
the airframer’s long-time workhorse A330ceo wide-body twinjet.
However, the A330neo has been beset by delays concerning its
Rolls-Royce engines and overshadowed by its flashier carbon
composite sibling, the A350XWB. 

This fall, the Airbus A330-900neo is finally expected to enter
service this fall with launch customer TAP Air Portugal. 

David
Neeleman.
David Slotnick/Business
Insider

So why has Portugal’s national airline gone with the A330neo
instead of the A350 or Boeing Dreamliner?

According to the TAP’s co-owner and serial airline
entrepreneur David Neeleman, it came down to the company’s
familiarity with Airbus, how well the A330neo fit with its route
network, and finally price. 

“We were already kind of with Airbus so it’s harder to make the
switch,” the JetBlue founder told us in a recent interview.

TAP currently operates an all-Airbus fleet headlined by the A320
family and the A330ceo. 

“Airbus is really good at cockpit commonality, so when we go to
train a pilot between an A320 and an A330, it’s a pretty easy
step up,” he added. 

TAP’s A330neo economy
cabin.
Benjamin Zhang/Business
Insider

That effectively put the Boeing Dreamliner out of
contention. But what about the A350?

“The A350 is a good airplane, but it’s kind of too much airplane
for us,” Neeleman said. “One of the advantages of the A350 is its
range. You can go 16 or 17 hours on and we didn’t need that
range.”

Many of the A350’s customers find the plane’s nearly 10,000-mile
range to be invaluable for ultra-long-haul routes connecting Asia
with Europe and North America. However, TAP’s route network is
designed to connect Portugal with North America and the
country’s former colonies. For example, TAP’s non-stop
service between Lisbon, Portugal, and Sao Paulo, Brazil is one of
the airline’s bread and butter routes. It’s also one of its
longest routes at just over 10 hours while covering around 5,000
miles. Thus, the A330-900neo’s 8,300 miles range will more than
suffice.

And then there’s the issue of money. 

The A330-900neo lists for $296.4 million while the comparable
A350-900 costs $21 million per plane. 

“We actually had an order for 12 A350s, but we needed more
airplanes,”  Neeleman said. 

The A330neo
cockpit.
Benjamin Zhang/Business
Insider

According to Neeleman, the A330neo boasted all of the fuel-saving
features of the A350, including next-generation engines, new
avionics, and optimized aerodynamics, but comes at a much lower
price.

“It kind of did everything we needed based on the money we had to
spend so we ended up going with the A330neo,” he said.

In 2015, TAP replaced the A350 order with a deal for 14 A330neos.

The A330neo has netted 224 orders from airlines around the
world headlined by Malaysian low-cost carrier AirAsia X as its
largest customer with 66 on order. The A330neo’s only US airline
customer is Delta with 25 orders on the books.

Earlier this year, American Airlines and Hawaiian Airlines both
canceled Airbus orders a favor of the Boeing Dreamliner.
Hawaiian’s defection to the Boeing camp is particularly painful
for Airbus because it was the last airline with orders for the
smaller variant of the A330neo, the A330-800neo. 

Benjamin Zhang/Business
Insider

According to Hawaiian Airlines CEO Peter Ingram, the A330neo’s
lack of sale was one of the reasons why the carrier opted to go
with the Boeing.  

“Unfortunately, the A330-800 has not proved to be as
popular in the marketplace,” Ingram said in an interview with
Business Insider earlier this year. “But for us, it doesn’t
make sense to remain committed to an airplane that had the risk
of not being sufficiently accepted in the marketplace in the
future.”