Avianca postpones remaining Boeing 787s amid orderbook shake up

Jan 7, 2020

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Avianca has rejigged its Airbus and Boeing orderbooks, including a deal that effectively postpones its remaining Boeing 787 Dreamliner commitments indefinitely.

Under a “fleet optimization” plan released Tuesday, Bogotá-based Avianca reached a “mutually beneficial agreement” with Boeing regarding its remaining 787-9 orders, the airline said in a statement. Other aspects of the plan include cancelling some of its orders for Airbus A320neo family jets, while agreeing to lease some of the European-manufactured narrow-bodies.

Avianca spokesperson Marta Marcela Alvarenga declined to comment further on the Boeing deal, except that Avianca is “comfortable” with its current fleet of 13 787s.

At the end of September, the carrier had commitments for three 787-9s due through 2021, according to its third quarter financial statement. Avianca operated 12 787-8s and one -9 at the time.

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An Avianca Boeing 787 Dreamliner. (Photo courtesy of Avianca)
An Avianca Boeing 787 Dreamliner. (Photo courtesy of Avianca)

 

The apparent changes to Avianca’s 787 orders come as Boeing faces a rapidly dwindling Dreamliner backlog. The Chicago-based planemaker cut production of the 787 by two aircraft a month to 12 in October, citing weak demand and the U.S. trade war with China.

Avianca is in the early innings of a two-year effort to strengthen its balance sheet. Unveiled in mid-2019, the plan calls for streamlining the airline’s fleet, reducing costs, and expanding its Bogotá (BOG) hub by 2021.

Part of this effort is a proposed three-way — possibly four-way — partnership with Copa Airlines and United Airlines, and maybe Azul, covering U.S. routes. The pact could boost passenger traffic — and revenues — for Avianca over its Bogotá hub.

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In addition to the 787 order changes, Avianca has restructured its A320neo family commitments with its next delivery of the narrow-body jets potentially postponed until 2023. That’s when deliveries begin under a new 12-aircraft deal with BOC Aviation to lease A320neos disclosed Tuesday.

The carrier has cancelled 20 of its own orders for for the A320neo family. Avianca will resume deliveries of its remaining commitments for 88 jets in 2025.

“The completion of these three major aircraft transactions… places Avianca in a solid position as it moves forward with the Avianca 2021 plan,” said Avianca chief financial officer Adrian Neuhauser in a statement.

Boeing declined to comment on the agreement with Avianca.

Featured image by Avianca.

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