Ireland based aircraft lessor Avolon has canceled orders for 27 Boeing 737 MAX. This news comes as a major surprise as the lessor had already canceled orders for 75 of the type in April. The 27 MAX aircraft canceled were set to be delivered in the 2020-22 time frame.
Over 100 Boeing 737 MAX orders have been canceled in the past month across the world. Photo by Brandon Farris | AeroNewsX.
The lessor has also canceled an order for an Airbus A330neo, which was also to be delivered by 2022 and deferred delivery for 3 Airbus A320neo from the 2020-21 timeframe to 2022.
Avolon released its financial results for the second quarter of 2020, in which it highlights some key developments made within the company. The lessor says that after the second quarter it still holds a strong liquidity position, with over $5 billion. Avolon also significantly improved its capital strength by reducing about 34% of its near term capital commitments till the end of 2021. Only 16 lease transactions were carried out by Avolon in the second quarter, at the end of which its fleet stands at 547 aircraft.
CEO of Avolon, Domhnal Slattery said “Q2 was a challenging period for the aviation sector as COVID-19 impacted the industry on an unprecedented global scale, bringing with it continued uncertainty around the pace and timing of a recovery. The months ahead will be difficult, but we have the experience and balance sheet to manage through these headwinds. In Q2 we continued to reinforce our strong capital position and have maintained over US$5 billion of total liquidity through the first half of this year.”
This major 737 MAX cancellation comes as another huge blow to Boeing as only recently Norwegian Air canceled 92 aircraft orders and aviation lessor BOC Aviation canceled 30. This does help Boeing clear its massive 737 MAX backlog, but it hurts its revenue book significantly.