The first Airbus A321neo, the largest and longest-range variant of the Airbus family of re-engined narrowbody aircraft, has been delivered to Virgin America.

San Francisco-based Virgin America, a subsidiary of Seattle-based Alaska Air Group, is leasing the A321neo from GE Capital Aviation Services (GECAS). It took delivery of the aircraft, powered by CFM International LEAP-1A engines, at an April 20 ceremony in Hamburg.

Virgin America president Peter Hunt said the A321neo “will allow us to further reduce our unit costs and enable us to further reduce our carbon emissions.”

The A321neo joins Virgin America’s fleet of 53 A320ceos and 10 A319ceos. Configured with 184 seats, the A321neo is expected to enter service May 31 on Virgin America’s San Francisco-Washington National transcontinental route.

Virgin America was acquired by Alaska Air Group in December 2016 and is in the process of being merged with Alaska Airlines. The Virgin America brand is slated to be retired in 2019.

Virgin America has 10 A321neos on order, all to be leased from GECAS. The airline will take delivery of five A321neos this year, according to Alaska Air Group CFO Brandon Pedersen.

Virgin America’s A321neo arrives as Alaska, which operates an all-Boeing 737 mainline fleet, is undertaking a review to determine whether it will continue to operate Virgin America’s A320 family fleet long term alongside its 737 fleet.

Pedersen recently told ATW that Alaska is in talks with GECAS regarding the five A321neos Virgin America is expected to receive next year. “We’re working with the lessor on what the right answer is for those airplanes,” he said. “Our reluctance is to bring more Airbus airplanes in on a long-term lease arrangement before we make a long-term fleet decision.”

“We’ll make a decision by the end of 2017” on whether to operate a dual mainline fleet long term, Alaska Air Group CEO Brad Tilden told ATW, adding, “I think we’re the only airline in the world that has ‘proudly all-Boeing’ on the nose of every single [Alaska Airlines] airplane. My dad was a Boeing guy, he was there for 32 years. We could not be more proud of our relationship with Boeing. Airbus is a good manufacturer. A320s are good airplanes. What we need to do now is just take our time, cool our jets, spend some time and make the best decision for the long-term future of the company. To be really clear, it’s not Boeing vs. Airbus. That’s not the decision we’re going to make. The decision we’re going to make is whether we operate one fleet type or two fleet types.”

Regardless, Pedersen said Alaska, which has 37 737 MAX aircraft on order, will likely operate most of Virgin America’s A320 family fleet until 2023-2024, when most of the leases on Virgin America’s aircraft expire—though the aircraft will be retrofitted with a standard Alaska Airlines interior by mid-2019. The fate of a Virgin America order on the books for 30 A320neos to be delivered from 2020 to 2022 “is entirely dependent on what we decide this year” regarding the long-term fleet, Pedersen said.

If those 30 A320neos are canceled, Alaska would likely add more 737 MAXs to its order book. “To the extent that we decide to go a different route on those 30 Airbuses, we’ll have to flex the Boeing order,” Pedersen said.

Aaron Karp aaron.karp@penton.com