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Kenya Airways To Sell Seven Planes, And Lease Them Back

Kenya Airways (KQ)[Photo/Courtesy]

National carrier Kenya Airways (KQ) is set to sell seven planes and one engine in a bid to reduce its fleet as part of recovery plans.

Among the planes to be sold include six Boeing 787-8 Dreamliners, one Boeing B777-300 and a spare GE engine.

The carrier will lease back the planes after selling them according to contract documents between KQ and UK-based Air Partner.

“Kenya Airways is conducting a series of sale and lease-back transactions covering six B787-8, B777-300 and GEnx spare engine. KQ has requested Air Partner to conduct a desktop review addressing a series of questions around these sale and leaseback transactions,” read part of the contract between KQ and Air Partner.

Read: Plans To Nationalise KQ Almost Through As MPs Adopt Report

By the end of 2018, KQ had a fleet of 41 planes comprising of Bombardier, Embraer and Boeing planes. In 2015, KQ had 52 planes and has now been dwarfed by its competitor Ethiopian Airline which has over 100 planes.

The reduction of the fleet has largely been attributed to mass exodus of pilots and engineers who have left the carrier for greener pastures, leaving KQ grappling with shortage that has led to mass cancellation of flights.

For instance, in the first two weeks of August, KQ cancelled 91 flights with 68 happening due to shortage of pilots.

According to the 2019 on time performance, 182 flights were cancelled this year occasioned by shortage of staffers with pilots and other crew failing to turn up for work. Out of 25,035 successful departures this year, 2,814 were delayed by more than an hour while only 22,426 (60 percent) were on time.

Read: KQ To Pay UK Firm Ksh25 Million To Investigate Collision Of Two Planes

An internal memo shows that the cancelled flights cost the ailing airline at least Ksh118 million in the last seven months of 2019, which was used in accommodation costs for affected passengers.

“During flight delayed or cancelled, Kenya Airways is expected to provide essential services such as accommodation, meals, ground transportation as the situation requires. With an increasing number of these incidents the costs of hotel accommodation and meals have been above budget by 250 percent,” read the confidential internal memo as quoted by Nation.

19,345 passengers were provided with accommodation in the first seven months of 2019, sinking KQ to more losses.

The sale comes eight years after the carrier announced plans to buy nine Dreamliners in 2011, with the first one having been delivered in 2014. A new Dreamliner is estimated to cost at least Ksh21.49 billion while a new GE engine is estimated to cost over Ksh1 billion.

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Written by Francis Muli

Follow me on Twitter @francismuli_. Email francis@kahawatungu.com

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