News
Avolon cancels another 28 737 MAX orders
July 10th 2020
Aircraft lessor Avolon said this week it had cancelled commitments to acquire 28 aircraft and pushed back delivery of three jets for up to two years in response to a difficult trading environment. Read More »
The cancellations are 27 737 MAXs planned for delivery from this year to 2022 and an A330neo scheduled for acceptance by the lessor two years hence. Additionally, three A320neo had their delivery dates pushed back from 2020-2021 to 2022.
Avolon CEO, Dómhnal Slattery, said the second quarter of calendar 2020 was a challenging period for aviation and that the pace and timing of the recovery from COVID-19 was uncertain.
"The months ahead will be difficult, but we have the experience and balance sheet to manage through these headwinds," Slattery said in a statement. "We have reduced our near-term commitments by over 140 aircraft since the start of the year."
This latest reduction in 737 MAX orders followed Avolon’s cancellation of 75 737 MAXs in the first quarter of the year.
Avolon said it had reduced near-term capital commitments to the end of 2021 by 34% in the three months to June 30. The rationalisation brought to 52% the reduction in capital commitments in the 2020-2023 timeframe.
The lessor said it had total liquidity, including unrestricted cash and undrawn secured warehouse facilities, in excess of US$5 billion at June 30.
"These actions provide us with the capital strength to manage through this market backdrop and to support our customers through the recovery,” Slattery said.
Twelve of the company’s customers were due to commence repayments at the scheduled expiry of their deferral arrangements in the second quarter of 2020. Seven made their payments in full and five fell into arrears or sought an extension to the deferral arrangement for some or all of their rental obligations, Avolon said.
