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Delta absorbs Latam order for 10 Airbus A350 jets

FILE PHOTO: Delta Air Lines passenger planes are seen parked due to flight reductions made to slow the spread of coronavirus disease (COVID-19), at Birmingham-Shuttlesworth International Airport in Birmingham, Alabama, U.S. March 25, 2020. REUTERS/Elijah Nouvelage

SAO PAULO/PARIS (Reuters) – Delta Air Lines (DAL.N) has taken over an order worth roughly $3 billion at list prices for 10 Airbus (AIR.PA) A350 jets from Latam Airlines Group LTM.S, the Chilean carrier said.

The deal, which Reuters reported earlier on Tuesday, firms up a planned switch first announced when the two carriers forged an alliance in 2019 and whose completion was partially disclosed in manufacturing data issued last week.

Airbus said in monthly order data that Latam, South America’s largest airline group, had cancelled 10 A350 jets. It also announced an order for 10 A350 aircraft from a different buyer, but it was not identified and analysts said it was not immediately clear whether the items were linked.

On Tuesday, Latam confirmed the switch.

“Delta has now assumed the fleet commitments for 10 A350 aircraft, as part of the framework agreement announced in September last year,” a Latam spokesman said.

Airbus and Delta declined to comment.

The formal transfer of the jet order coincides with Delta and other U.S. airlines negotiating government aid to help them meet their payroll costs while dealing with a drastic drop in air travel demand because of the new coronavirus pandemic.

Bloomberg News reported on Tuesday, citing people with knowledge of the matter, that Delta had also agreed to sell and lease back aircraft valued at $1 billion as part of efforts to raise cash while it continues talks about U.S. government aid.

Delta did not immediately comment on the report.

Reporting by Tim Hepher, Tracy Rucinski, Marcelo Rochabrun; editing by Jason Neely and Grant McCool

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