We’ve been closely following developments with Air Belgium over the past few months. First, they suspended all of their scheduled flights only operating wet leases. Now it looks as though the airline will be wound up altogether after an emergency general meeting was called. It’s been a challenging month for airlines and this news follows the bankruptcy of Primera Air at the start of the month, and Cobalt Air yesterday. The news doesn’t necessarily come as a surprise given the bizarre business model that the company was being run under, however, it is always sad when the aviation industry suffers a loss.
Air Belgium was launched back in 2016, however, the airline didn’t make its first flight until earlier this year. It is currently based out of Brussels’ secondary airport, Charleroi. The airline is maintaining a fleet of four A340 aircraft. However, as it was only serving one destination, Hong Kong, the airline had two of its aircraft sitting on the ground. Air Belgium then suspended flights to Hong Kong around a month ago, focusing its efforts on wet leasing. Now three of its A340 aircraft are sitting on the tarmac while one is out making money operating BA’s London to Abu Dhabi route. Given the current shortage of long-haul aircraft due to the ongoing B787 engine issue, it is a surprise that the other three aircraft aren’t out making money.
Air Belgium is running an incredibly inefficient fleet. The A340s operated by the airline are all leased and were constructed between 2007 and 2008. All 4 of the aircraft were previously operated by Finnair. The A340 was designed with 4 engines at a time when ETOPS regulations weren’t around. This meant that two engine aircraft had to stay within 60 minutes of a diversion airport. As such the A340 was created. However, having four engines means that the A340 is using a lot more fuel than it needs to. This puts the aircraft at a significant disadvantage to its competitor the B777 which only uses 2 engines. As such, Air Belgium is having to pay significantly more to operate than if it had chosen two engine aircraft.
How Long Does Air Belgium Have?
There are three possible outcomes for Air Belgium as it currently stands. The first is that following the general meeting held by the board of executives today, the airline is wound up. This would almost certainly mean that all of the aircraft are grounded immediately and British Airways would need to find a new aircraft to lease. The second outcome is that the airline keeps operating the way it is. Currently, Air Belgium is solely reliant on its wet-lease agreement with British Airways, take that away and the airline will almost certainly crumble if it doesn’t beforehand. If, however, Air Belgium were able to lease out its remaining 3 A340 aircraft, it may place the airline in a better financial position. One reason that this may not have happened yet is crew shortages, as, by all accounts, the demand for wet leased long-haul aircraft is out there.
As always only time will tell the fate of Air Belgium. Do you think they can survive? Let us know in the comments below!