Iran’s Mega Deal with Airbus inches closer to Finalization

By Changiz M. Varzi, for Al-Monitor. Any opinions expressed are those of the author, and do not necessarily reflect the views of Iran Business News.

After the United States issued a second license to Airbus to sell 106 planes to Iran on Nov. 21, the French aircraft manufacturer once again made headlines in Iranian media on Nov. 23. The US government’s green light to the agreement is a result of the nuclear deal, which lifted nuclear-related sanctions on Iran in return for curbs on its nuclear program.

On Sept. 21, Airbus announced that an application to sell 17 airplanes to Iran was approved by the US Department of Treasury’s Office of Foreign Assets Control (OFAC). Although Airbus is based in France, it must obtain OFAC approval to sell planes to Iran because at least 10% of the components used to build the planes are made in the United States.

Airbus’ first application for a license to sell passenger jets was for the jets Iran most urgently needs. Tehran is determined to breathe new life into its aging fleet. On the same day, US aircraft manufacturer Boeing received authorization by OFAC to sell 109 passenger jets to national carrier Iran Air.

On Nov. 23, Shahrvand daily ran the article “106 Airbus [jets] on the way to Iran,” which reported the new development to boost trade between Western companies and Iran. “Despite the attempts by the US House to revoke the permission [to sell aircraft to Iran], a delegation from Airbus is now in Tehran to finalize the deal between Iran and the aviation company,” wrote Shahrvand.

Meanwhile, business daily Abrar-e Eqtesadi said that Iran had reached an agreement with an international leasing company to facilitate the purchase of 77 Airbus planes. According to the daily, Asghar Fakhrieh Kashan, deputy for international affairs at the Ministry of Roads and Urban Development, announced, “The final contract to buy 112 Airbus [jets] is ready to be signed.”

Iran provisionally agreed to purchase 118 Airbus jets in January. This figure dropped to 112 after an order for six smaller Airbus jets was discarded over delays in OFAC licensing of the sale. The final number of plane deliveries may be around a hundred, given that Iran says it may not proceed with its option to purchase a dozen A380s, the world’s largest jetliner.

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