In a conversation with Simple Flying last week, easyJet CEO Johan Lundgren revealed the airline is more than willing to invest in additional aircraft if necessary. With over £5.5 billion raised in liquidity, the airline is expecting delivery of new planes from next year and will be able to add to its fleet at any time.
Over 100 aircraft on order
During Simple Flying’s Future Flying webinar last week, easyJet CEO Johan Lundgren spoke about the carrier’s fleet strategy moving forward. According to Lundgren, easyJet has a total of 101 aircraft on order with the option for an additional 78. The majority of planes on order are the A320neo, with several of the larger A321neo also on the way.
Interestingly, Lundgren hinted that easyJet would be more than willing to increase its order book should it be necessary. However, this would all depend on whether or not “the fleet is adapted to demand.”
Lundgren said,
“If we want to and we find that it’s the right thing to do, we can go over and above that to make sure that we always will have the supply that is there to meet the demand.”
One aircraft easyJet isn’t interested in is the A321XLR. Lundgren revealed that easyJet isn’t planning on entering the long-haul market any time soon and sees more opportunities for growth in the short-haul market.
New deliveries expected next financial year
After the COVID pandemic put fleet renewal on hold, Lundgren said that easyJet expects deliveries again in the next financial year. Presently, the airline expects eight deliveries next year and seven the year after that.
Lundgren said,
“We’re proud to take on eight deliveries here next year, and seven deliveries the year afterward.”
Sale and leaseback strategy
Over the course of the pandemic, easyJet implemented its largest cost reduction program ever, reducing costs by over £500 million. The airline also used a sale and leaseback strategy to raise much-needed capital, reducing its fleet ownership from around 70% to 50%.
By maintaining a good relationship with lessors, easyJet benefited from favorable sale and leaseback deals.
Lundgren explained,
“The very good reputation with the lessor is because they know we take care of our aircraft. We have a great maintenance program. So we’ve achieved satisfactory pricing out of the transaction.”
Lundgren also praised the way easyJet has been run over the years, stating that easyJet has been “conservatively and fiscally well run for many many years, and that helped us coming into this.”
Lundgren added,
“When we did this whole thing about raising the liquidity, we went to a wide variety of sources. We came into this as one of the strongest airlines in Europe, and actually in the world, if you’re looking at it from a balance sheet point of view.”
Do you think easyJet will opt to bring in more aircraft? What kind of future do you see for easyJet in a post-pandemic world? Let us know your insights in the comments.
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