easyJet Defers Airbus Orders In Midst Of Founder Upset

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easyJet has managed to delay the delivery of 24 Airbus aircraft. The British carrier was due to receive these units between 2020-2022. However, its co-founder sir Stelios Haji-Ioannou has been pressuring leadership to cancel the orders amid the global aviation crisis.

Airbus A320neo
There won’t be as many new Airbus aircraft joining easyJet as initially expected. Photo: Airbus

War of words

The low-cost airline has been expecting a total of 107 A320neos to eventually arrive. Amid the downturn in flight activity, Sir Stelios has been expressing his frustration about the orders.

He has even criticized his partners at the firm and questioned if the contract is even valid. Additionally, he has threatened legal action and the removal of members of the board.

easyJet was prepared to take 10 of the new planes this year, another 12 next year and two more in 2022. Now, it won’t receive any units in 2021 and has the option to defer another five in 2022. According to FlightGlobal, the dates of these future deliveries are to be agreed in response to the demand environment.

Sir Stellios Easyjet
Sir Stelios has been worried about the state of his airline’s finances. Photo: Getty Images

Shifting focus

The airline’s CEO Johan Lundgren shared that the whole market is facing unprecedented challenges that require action like this to be taken. Meanwhile, he is concentrating on tackling the issues that the operator immediately faces.

“As we have consistently said, we remain completely focused on improving short-term liquidity and reducing expenditure across the business.” Lundgren said, as reported by FlightGlobal.

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“Today, I am pleased to announce that we have agreed with Airbus to amend our delivery schedule by deferring the purchase of 24 aircraft, providing a significant boost to our cash flow and a vast reduction to our near-term capex programme.”

European airlines coronavirus
Across the board. low-cost carriers are having trouble during the drop in demand. Photo: Getty Images

A moment of clarity

Altogether, even though Sir Stelios wants the whole contract to be canceled, the airline at least has some breathing space. This report follows the news that the easyJet has had a £600 million ($740 million) loan approved by the United Kingdom government.

This is a loan that Sir Stelios said wouldn’t be needed if the £4.5 billion ($5.6 billion) Airbus deal was axed. The airline is also is seeking a further $500 million from commercial creditors to ensure liquidity targets are reached.

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During such a stressful period for the company, it will be glad to have had some support this week. Nonetheless, it will be hoping that the ongoing travel restrictions don’t prolong for many months as it is continuing to lose money each day that its grounded aircraft are not in the skies.

Simple Flying reached out to easyJet on its orders but did not hear back before publication. We will update the article with any further announcements.

What are your thoughts on easyJet being able to push back some of its orders for the Airbus A320neo aircraft? Do you think Sir Stellios will be happy about this move? Let us know what you think of the situation in the comment section.

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