Airbus Says US Grants License for Planes in Iran Deal

EghtesadOnline: Airbus announced Wednesday that the U.S. government has granted it a license to sell the first 17 airplanes involved in a landmark deal with Iran made possible by last year's nuclear agreement.

News ID: ۷۳۷۰۵۸

21 September 2016

The announcement comes as Iranian leaders and U.S. officials are gathered this week in New York for the United Nations General Assembly and serves as a sign that the outgoing administration of President Barack Obama will honor the economic terms of the accord, reports Bloomberg.

Airbus received the license from the U.S. Treasury's Office of Foreign Assets Control, Airbus spokesman Justin Dubon told The Associated Press. He said the first 17 planes will be A320s and A330s. He declined to offer a breakdown of how many of each are involved in the initial sale, but said Airbus hoped to receive a second license allowing it to sell the remaining planes to Iran.

Though based in Europe, Airbus was required to get the U.S. Treasury's approval for the deal as at least 10 percent of Airbus components are of American origin.

Iran's U.N. mission did not immediately respond to a request for comment and the country's state media did not immediately report the approval. On Sunday, Asghar Fakhrieh Kashan, a deputy transportation minister, told reporters that he expected U.S. permission for all aircraft purchases "by the end of September" and that several airplanes would arrive by mid-March.

In January, national carrier Iran Air signed agreements to buy 118 planes from Airbus, estimated to be worth some 22.8 billion euros ($25 billion). The deal included 21 A320ceos, 24 A320neos, 27 A330ceos, 18 A330neos, 16 A350-1000s and 12 double-decker A380s.

Base model A320s are currently listed at an average of $98 million, while A330s start at $231.5 million.

That puts the value of the approved 17 aircraft in the first license around at least $18 billion and possibly much higher based on list prices, though buyers typically negotiate sizable discounts for bulk orders.

Most Iranian planes were purchased before the 1979 Islamic Revolution that ousted Shah Mohammad Reza Pahlavi and brought Islamists to power. Out of Iran's 250 commercial planes, 162 were flying in June, while the rest are grounded due to lack of spare parts.

The announcement by Airbus will be closely watched by Chicago-based Boeing Co., which has an agreement with Iran that Iranian officials have suggested could be worth as much as $25 billion. Such a deal would be the biggest between an American company and Iran since the Islamic Revolution and U.S. Embassy takeover.

In a June letter to the U.S. Congress, Boeing said the deal involves Iran Air buying 80 aircraft with a total list price of $17.6 billion, with deliveries beginning in 2017 and running until 2025. Iran Air also will lease 29 new Boeing 737s.

Iran also has ordered 20 airplanes from French-Italian aircraft manufacturer ATR.

Iran's nuclear deal with world powers, which limits its enrichment of uranium in exchange for the lifting of some international sanctions, specifically allows for the purchase of aircraft and parts. However, the Boeing deal has been criticized by both American lawmakers and Republican presidential candidate Donald Trump.

In a statement, Boeing spokesman Marc Sklar said his company believed Airbus applied before it did and that the U.S. government "follows a first-in, first-out policy."

"We look forward to receiving our license from the government shortly," he said.