EasyJet agreed with Airbus to defer delivery of 22 A320 Family jets due to significant loss related to the COVID-19 pandemic.
On December 22, 2020, a British low-cost airline EasyJet announced that deliveries of 22 Airbus A320 Family aircraft would be put off from 2022 – 2024 to 2027 -2028. The decision to push back the handover follows the airline’s financial situation which was strongly impacted by COVID-19 pandemic-related air travel restrictions.
The air carrier also agreed with Boeing to move 15 delivery dates within a period of 2022 to 2024. EasyJet expects that the postponement of its order deliveries will help to reduce the capital in the short term, which is important to manage through the immediate impact of the pandemic. However, the airline does not drop the target to renew and modernize its fleet over the longer term.
The airline had contractual commitments for 101 Airbus A320 aircraft, the estimated list price of which is $12.16 billion, as of September 30, 2020. In April 2020, EasyJet considered canceling the order, which was made in 2013. However, if the airline had withdrawn from the agreement, it would have had to compensate Airbus for discounts on 45 aircraft. The 45 aircraft have already been delivered to the airline since the order was made.
The airline is adjusting fleet expansion plans after having suffered the first loss in 25-years of operating history. On November 17, 2020, EasyJet stated that due to the COVID-19 air travel restrictions, its pre-tax loss reached €1.4 billion for the year to September 30, 2020. In comparison, the air carrier made a profit of €479 million in the same period of 2019. The airline also announced that the number of passengers dropped by 50% to 48.1 million, while it flew a total of 96.1 million travelers in 2019.
The air carrier has reduced the number of its employees by cutting 4,500 jobs. The low-cost also raised up to €1.1 billion from aircraft sale and leaseback deals as well as received a €669 million loan from the government of the UK, the financial report showed.
Having a total of 175 aircraft in the fleet, EasyJet expects to operate no more than 20% of planned capacity for Q1 2021.
