Easyjet is to defer delivery of at least 24 Airbus aircraft which it was due to receive over the next three years.
The carrier will defer ten aircraft which it was due to take delivery of this financial year, as well as a further 12 in FY21, and two in FY22. In addition the airline retains the option to defer a further five deliveries in FY22.
The move means that Easyjet will not take delivery of any aircraft in FY21. It said that “Exact dates of future deliveries of the deferred aircraft are to be agreed in response to the demand environment”.
Further to the deferrals the carrier has 24 operating leases due for renewal in the next 16 months, which it said provided the airline with “further flexibility”, including the possibility of deferment or cancellation.
Easyjet’s entire fleet is currently grounded, and earlier this week the airline secured a £600 million loan from the Covid Corporate Financing Facility (CCFF), issued by HM Treasury and the Bank of England, and
The carrier said that it “continues to focus on maximising liquidity in the event of an extended grounding period and to ensure the business is ready to react to reduced demand as the European airspace begin to reopen”.
The airline is due to publish its latest trading update on April 16, and said that “As a result of these actions the fleet has the flexibility to be substantial lower than our previous plan whilst also retaining the flexibility to respond to future demand environments”.
This week Easyjet’s founder and largest shareholder Stelios Haji-Ioannou again called for the carrier’s £4.5 billion contract with Airbus to be cancelled, warning that failure to do so could see the airline run out of money “around August 2020, perhaps even earlier”.
Commenting on the aircraft deferrals Easyjet’s CEO Johan Lundgren said:
“Our industry is facing unprecedented challenges which require unprecedented action. As we have consistently said, we remain completely focused on improving short term liquidity and reducing expenditure across the business.
“Today [April 9] I am pleased to announce that we have agreed with Airbus to amend our delivery schedule by deferring the purchase of 24 aircraft, providing a significant boost to our cash flow and a vast reduction to our near-term capex programme.
“In addition, we have 24 leases up for renewal over the next 16 months, which gives us another level of flexibility to respond to future demand.”