The reason why Asian airlines have been ordering many Airbus A320s and Boeing 737s with new engines allow fuel savings.

 
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New York (AirGuideBusiness - Business & Industry Features) One reason many Asian airlines have been ordering many Airbus A320s and Boeing 737s is that engine improvements now allow significant fuel savings. Ample liquidity provided by money-printing central banks has also made it easier to fund the relatively small upfront payments needed to place headline-grabbing plane orders. But bankers warn the race to buy efficient aircraft in anticipation of high demand could spell trouble for the sector. "When you run an airline, for reasons which are both economic reasons and prestige, you want a new kit, so you order an aircraft. And if your neighbour orders aircraft, so you order aircraft," said Bertrand Grabowski who heads German bank DVB's aviation and land transport finance divisions. "I wouldn't call it irrational exuberance but clearly everybody in Asia is ordering aircraft more than they really need," Grabowski told Reuters in an interview. Most of the aircraft orders come from the region's two fastest growing airlines - Malaysia's AirAsia Bhd, run by entrepreneur Tony Fernandes, and Lion Air, co-founded by Indonesian businessman turned politician Rusdi Kirana. Both carriers have placed orders for hundreds of Boeing and Airbus aircraft valued at tens of billions of dollars as they race to get Asians flying in a region set to overtake the United States as the biggest aviation market. Others ordering aircraft include Cebu Pacific, Tiger Airways, 40-percent owned by Singapore Airlines Ltd, Garuda Indonesia's low-cost unit Citilink, and the Qantas Airways Ltd-owned Jetstar and its affiliates such as Singapore-based Jetstar Asia. In the event that any airline cannot complete an order, there are others waiting in the wings to take their slot. While Fernandes has dismissed speculation of an aircraft order...

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