Air France-KLM in talks with Boeing and Airbus for mega order aircraft.

Air France-KLM has begun negotiations with Boeing and Airbus on what could be the group’s biggest-ever aircraft order as it seeks to expand low-cost operations and renew part of its main Dutch fleet.

The order for 160 single-aisle planes would be destined for the Transavia and European operations at KLM, a spokesman said Monday. The brands currently operate only Boeing jets on short- and mid-range routes, Bloomberg reported.

See also: KLM recovers its network of destinations in North America.

The contest will pit Boeing’s resurgent 737 Max against Airbus’s A320neo-series narrow-bodies. The fleet at Transavia, which has French and Dutch divisions, comprises mostly 737-800s, and the addition of aircraft from another manufacturer would go against the strategy of budget rivals like EasyJet Plc, which stick to a single type to keep down costs. KLM also operates 737s and has been standardizing around Boeing models for long-haul flights.

Air France-KLM Chief Executive Officer Ben Smith has made the expansion of low-cost operations a key element of plans to rebound from the coronavirus pandemic. He aims to as much as triple the number of Transavia jets based in France after the group lost market share there to low-cost competitors.

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