This is a real head-scratcher…
In this post:
EgyptAir selling its Airbus A220 fleet
FlightGlobal reports that EgyptAir has sold its entire Airbus A220 fleet to aircraft leasing company Azorra. These are planes that EgyptAir owns outright, so this isn’t even a case of an airline returning aircraft to a leasing company.
For context, EgyptAir has a fleet of 12 A220s, with all jets being the larger A220-300 variant. The A220 is an absolutely delightful aircraft, both for airlines and passengers. The plane has amazing economics, and on top of that, a great passenger experience, thanks to the 2-3 layout, and spacious cabin. In the case of EgyptAir, these planes are an average of just a few years old.
Interestingly, much of this fleet has been parked for quite some time, and only two of these planes have even been flying in recent weeks. For at least some amount of time, the planes were parked due to engine issues, but that’s an issue that has now been resolved.
The CEO of Azorra explains that the company has “strong partnerships with Airbus and Pratt & Whitney,” which facilitated this “creative transaction” for acquiring Airbus A220s.
Why would EgyptAir get rid of its Airbus A220s?
Obviously it’s unusual to get rid of nearly new aircraft, especially when you outright own them. When we have seen this happen in the past, it has usually been for wide body aircraft, in situations where a plane offered too much capacity for an airline. However, that’s definitely not the case at EgyptAir, as the A220 is the carrier’s smallest mainline jet.
What makes this development so bizarre is that at the November 2023 Dubai Airshow, EgyptAir went on a shopping spree. The airline ordered 10 Airbus A350-900s and 10 Boeing 737 MAX 8s. This was an odd move in terms of fleet commonality, when you consider that prior to this order, the airline had been modernizing its fleet with Boeing 787-9s and Airbus A320neo-family aircraft.
Also during the Dubai Airshow, EgyptAir’s CEO expressed his desire for the airline to grow, with a plan to operate a fleet of 125 aircraft by 2028. So dumping some of the most fuel efficient and cost effective aircraft in the fleet seems like a really odd direction to take, if you’re looking to grow.
While EgyptAir hasn’t actually provided a reason for this decision, the company’s CEO has stated that selling A220s “clears the path for new Airbus wide body aircraft.”
So it’s anyone’s guess what’s going on here, but I think this most likely comes down to an inefficient government owned airline without a vision acting like an inefficient government owned airline without a vision. 😉 A few thoughts:
- A couple of weeks ago, Egypt’s government called on the national carrier to restructure
- It almost seems like since these planes are outright owned by EgyptAir, this was viewed as an easy way to raise capital, since you can’t raise money in the same way from leased aircraft
- I imagine EgyptAir was able to get a decent amount for these aircraft, given the demand for modern jets; I’m curious to see where they end up
Regardless, there’s no logical justification for this development, at least if you’re going to try to have a cohesive, long term strategy. A few months ago, EgyptAir was talking about how it wanted to grow massively in the coming years. Now airline executives are saying that selling new narrow body planes will allow the airline to take delivery of new wide body planes…
Bottom line
EgyptAir is dumping its Airbus A220 fleet, even though these jets are just a few years old. The planes are being acquired by an aircraft leasing firm, and will presumably be flying for other airlines in the near future. This is a puzzling move, when you consider that EgyptAir just spent billions of dollars on new aircraft orders recently, and on top of that, the airline is hoping to grow its fleet massively.
What do you make of EgyptAir getting rid of its A220s?
The CEO of EgyptAir recently made a comment explaining that they are getting rid of their A220s because they aren't suitable to the environment in the region. So that explains why they are dumping these new fuel efficient aircraft while ordering other new airframes, and also likely why the airline has already parked much of the A220 fleet.
It seems the aircraft will be transferred to Azur Air in Russia.
Word is, A220 is not performing well in the region due to environmental conditions and Egyptair got fed up. Egyptair made a deal with Airbus (hence the creative transaction) to purchase A350s at the dubai airshow and Airbus taking back the A220s.
I was due to fly on one of MS's A220s last November - my first flight on the type - only to find that we got swapped out for a grubby, white-tailed 737.
Recently in Egypt. Lots of news about the huge debt accumulation by the govt.
Building a new city east of Cairo, with Chinese building the tallest building on the African continent.
Middle East money coming in by the load.
Many new homes built, no one in them.
Sounds a bit like China.
Egypt has 70% poor. Sure hope and pray this country gets better and raises the people out of poverty.
We Love Egypt.
I've flown EgyptAir 220s multiple times in the last two years and it's been a very pleasant experience. Much more so than their aging 737 fleet - seats, overall cabin feeling, 2-3 vs 3-3; it's a pity if they are really dropping them.
GTF engine problems is the bottom line .. IMO
… why they be getting rid of the A220…
Hopefully Delta can pick them up for cheap
2-3 layout is a selling point? This is not 1964. Let the DC-9 die.
you clearly have never flown on an A220 which makes a DC9 or any version of it die.
If you think that sitting in one of TWO groups of 3 seats is something of valor, you would be in a very small minority.
corruption, a corrupt army runs the country and they can sell their mothers for a buck, that's all I can think of.
EgyptAir is selling the family silver.
Egypt is undergoing a major economic crisis and is facing serious hard currency shortages.
Until 2021, the 1 USD was around 15 EGP. The government devalued the Egyptian pound last year, and is expected to do so in the coming next days. Currently, the official rate is still 30.95 to the USD but the black market rate is hitting 72 EGP. Anything that can bring in much...
EgyptAir is selling the family silver.
Egypt is undergoing a major economic crisis and is facing serious hard currency shortages.
Until 2021, the 1 USD was around 15 EGP. The government devalued the Egyptian pound last year, and is expected to do so in the coming next days. Currently, the official rate is still 30.95 to the USD but the black market rate is hitting 72 EGP. Anything that can bring in much needed hard currency, like selling under utilised planes, is not surprising.
Indeed
The joys of Government owned Airlines!
I think I have read on some aviation websites that the A220s were not performing too well in hot weather conditions, and that was one of the reasons MS parked the A220s, apart from the engine issues. Other carriers from the region have also reported similar performance issues.
This could be a Sale-and-Lease-Back Agreement where the airline sells the aircraft to a leasing company and leases them right back. Airlines often do it to get some cash for further investments. Lufthansa just did that with 12 of their A320s.
Wasn’t there rumblings about sand and sea air causing issues with these new turbo gear engines.
This sounds familiar like the Rolls-Royce RB211 issues of the early 70’s.
Anyway, opportunity for Delta, Qantas, or JetBlue to pick up a low mileage airframe at a reasonable leasing rate, especially since these are the 300 series.
Way for EgyptAirto get some liquidity to try to get better financing terms for acquisitions of other planes?
EgyptAir is selling the family silver.
Egypt is undergoing a major economic crisis and is facing serious hard currency shortages.
Until 2021, the 1 USD was around 15 EGP. The government devalued the Egyptian pound last year, and is expected to do so in the coming next days. Currently, the official rate is still 30.95 to the USD but the black market rate is hitting 72 EGP. Anything that can bring in much...
EgyptAir is selling the family silver.
Egypt is undergoing a major economic crisis and is facing serious hard currency shortages.
Until 2021, the 1 USD was around 15 EGP. The government devalued the Egyptian pound last year, and is expected to do so in the coming next days. Currently, the official rate is still 30.95 to the USD but the black market rate is hitting 72 EGP. Anything that can bring in much needed hard currency, like selling under utilised planes, is not surprising.
This isn't a sale leaseback?
Countries like Egypt don't really know what maintenance is. So no surprise there.... they do it if they really have to. Long haul planes are too expensive so they do maintenance, this one is relatively cheap....
Wow, that's telling it like it is....
Not a big surprise here. These planes have been packed for a very long time. They’re apparently the same issues that Air Tanzania and Air Senegal were having with their A220s - sth about performance issues at high temperatures/ humidity. Air Senegal already returned theirs.
Air Senegal used engine issues as an excuse to get out of a contract they realised they couldn't afford anyway because the airline was effectively bankrupt after barely 2 years in operation. So not the best example.
I can't give out full details, but another A220 airline was considering taking multiple examples in for summer season (and even beyond), however they discovered massive corrosion in these ex-Egyptair planes and idea was dropped. It is bit hard to believe, considering that weather in Egypt are very well suited for long term aircraft storage but here we are lol. Let's hope whoever takes those planes in will be able to fix them up.
Air Canada
Their A220 fleet is struggling with PW GTF engine issues that they don't seem to be able (or willing?) to solve. Azorra specialises in deals like this and probably already have something worked out with PW to get them back in the air.
Also, Egyptair did the same thing with their Embraer fleet a few years ago. One day they pretty much decided that they wanted a new toy instead, so they parked them and...
Their A220 fleet is struggling with PW GTF engine issues that they don't seem to be able (or willing?) to solve. Azorra specialises in deals like this and probably already have something worked out with PW to get them back in the air.
Also, Egyptair did the same thing with their Embraer fleet a few years ago. One day they pretty much decided that they wanted a new toy instead, so they parked them and left them to collect dust in Cairo for years. It is only recently that those have begun to be remarketed.
Aircraft procurement and disposition can be a goldmine for padding the pockets of the corrupt.
The airline management have little incentive to care. But if they did care, they seems to be nowhere close to being the brightest tools in the toolbox by having let so much money sit idle locked up in parked assets which could have freed up or even generated hard currency by having done this kind of sale thing earlier or...
Aircraft procurement and disposition can be a goldmine for padding the pockets of the corrupt.
The airline management have little incentive to care. But if they did care, they seems to be nowhere close to being the brightest tools in the toolbox by having let so much money sit idle locked up in parked assets which could have freed up or even generated hard currency by having done this kind of sale thing earlier or even perhaps gotten into leasing out or even aimed for wet-leasing their planes. The country is awash in very cheap labor and its hard currency needs are great and even greater now with regional politico-economic disruptions.
Could it not be a sale and leaseback to pay down some other debt? Just, that the leaseback hasn't been announced yet?
Whats the over/under on how long before there is some sort of bribery scandal uncovered to do with aircraft deals at Egyptair?
Boeing "influencing" this?
I flew through Cairo twice in recent weeks, the first time in thr middle of December and again in the beginning of January. I was also surprised to see most of their A220 fleet parked at CAI.
That included one A220 in an all white livery. I believe that was the plane they used to operate to Tel Aviv. I thought they had gotten rid of the Air Sinai brand and plain white A220s and repainted them.
Paging Sean M