Transaero, one of Russia's leading airlines, signed a memorandum with the European Airbus holding on Tuesday to buy eight A320 neo airplanes with a catalogue price of $729 million.
The memorandum of understanding signed on the sidelines of the six-day MAKS-2011 air show near Moscow also provides for an option for another four A320 neo aircraft.
Transaero's fleet has until now consisted of 55 Boeings and three Russian-made Tu-214s.
Airbus plans to start the production of A320 neo planes with new modernized engines in spring 2016. The engine will use 15% less fuel, reduce noise and increase the maximum flight distance by 950 km. It will also make it possible to carry more weight onboard.