Virgin Atlantic Airways is deferring the delivery of leased and owned Airbus A330neos and A350s to maintain liqudity as part of its refinancing plan, Air Lease executive chairman Steve Udvar-Hazy has disclosed.
Speaking on an investor call on 6 August, Hazy said that Air Lease, Aercap and Avolon had all participated in the £1.2 billion ($1.3 billion) financing plan as part of a “pre-packaged” reorganisation.
“What we did is some of our deliveries have been rescheduled. But most importantly, their
Six A330-900s being placed by ALC on lease with the UK carrier will now arrive after the airline’s purchased A330-900s, of which the London-based carrier has 14 on order and is in the process of taking delivery of a 12 A350-1000 order, he added.
A mixture of owned and leased A350-1000s are replacing the carrier’s last 747-400s and the A340-600s, Udvar-Hazy said, giving the carrier a “much more streamlined” fleet of 787-9s, A330neos and A350-1000s.
He said Virgin Atlantic intends to use the A350-1000s for high-density routes like New York, while the 787s will operate the “longer, let's say, a little thinner routes”, many as part of a codeshare or joint venture with shareholder Delta Air Lines.
The A330-900s will do “a lot of the other stuff” like services to Florida, the Caribbean, the Middle East and secondary markets in Canada.
“So it took a lot of effort. And the other key lessors, Aercap and Avolon, participated. We don't have any aircraft at Virgin at the moment, but we obviously had to be cognizant of a total solution rather than a sort of a partial solution,” Udvar-Hazy noted.
He said the airline’s UK bank lenders, Delta as a 49% shareholder and credit card processors had participated in the restructuring.
Virgin Atlantic Airways has filed for Chapter 15 protection in the USA and has started a parallel process in the UK to secure a legally binding agreement from creditors for its refinancing and restructuring plans.
Aercap has 12 aircraft placed with Virgin consisting of a mixture of A330s, A340s and 787s. Avolon has one A330 and three 787s placed with the UK carrier.