UK’s Virgin Atlantic defers deliveries

Virgin Atlantic (VS, London Heathrow) has deferred deliveries of its forthcoming widebody aircraft and currently plans to take leased aircraft ahead of direct purchases from Airbus, Executive Chairman of Air Lease Corporation (ALC) Steve Udvar-Hazy said during the lessor’s quarterly earnings call. “Some of our deliveries [to Virgin Atlatic] have been rescheduled. But most importantly, their direct buys were rescheduled to later timeframes, which means, the airline has to pay less in fee delivery deposits to Airbus. And therefore they can affect their cash liquidity position. And the leased aircraft from ALC will actually arrive before the purchase aircraft,” Udvar-Hazy said. He underlined that ALC participated in the carrier’s pre-packaged restructuring together with other lessors such as Avolon and AerCap despite having no aircraft placed with Virgin at this time. However, adopting a long-term strategy, the lessor wanted to be “cognisant of a total solution rather than a sort of a partial solution”. According to the ch-aviation fleets advanced module, Virgin Atlantic has outstanding orders for eight A330-900s and three A350-1000s due directly from Airbus and plans to take six A330-900s and four A350-1000s from ALC. The lessor’s chief executive officer, John Plueger, underlined that Virgin’s decision to revise the sequence of deliveries was in line with global trends. “Even if an airline has not cancelled its orders, it shifts or pushes back its direct orders to much later points in time, yet knowing that it actually does need the new aircraft, as they move forward they take our [leased] positions earlier,” he explained, naming Korean Air (KE, Seoul Incheon) as one example of an airline which will take leased B787s before those it owns.