| 16.1°C Dublin

AerCap pulls order for 15 Boeing 737 Max jets

Close

Grounded: A Boeing 737 Max airplane being built on the assembly line in Renton, Washington. PHOTO: AP/TED S WARREN

Grounded: A Boeing 737 Max airplane being built on the assembly line in Renton, Washington. PHOTO: AP/TED S WARREN

Grounded: A Boeing 737 Max airplane being built on the assembly line in Renton, Washington. PHOTO: AP/TED S WARREN

Aircraft leasing giant AerCap has cancelled orders for 15 of Boeing's grounded 737 Max jets.

AerCap has already taken delivery of five of the Max jets and has orders still in place for another 80. It owns a fleet of 1,357 aircraft.

Boeing's 737 Max aircraft were grounded by aviation authorities in March 2019 following two fatal accidents and production of the plane was temporarily suspended by Boeing in January.

AerCap said it reached agreement with Boeing this month to restructure its order book for 737 Max aircraft, cancelling 15 orders.

Where AerCap customers have the right to cancel leases for the controversial airplanes, AerCap said in cases where lessees have the right to cancel leases it had the right to cancel the corresponding orders for delivery of those aircraft.

AerCap recorded a decline in income in the second-quarter of the year to $246m (€209m) from $331m in the same period a year earlier, hit by the global travel slump as a result of Covid-19, including the impact of airline bankruptcies.

Analysts at Davy said AerCap's results show it has weathered the disruption to the global travel industry this year.

"The liquidity and leverage positions are also healthy and indicative of AerCap's staying power in difficult conditions," they said in a note.

AerCap said it does not yet know when the five 737 Max planes it has taken delivery of will return to service, and said the uncertainty around the Boeings will continue to be a financial drain.

AerCap CEO Aengus Kelly told analysts he expects aircraft manufacturing to slow amid the slump in global travel as a result of the pandemic.

Irish Independent