Listen live as Artemis II crew returns to Earth, starting at 5:50 p.m.

Abu Dhabi’s long-troubled Etihad sells 38 planes for $1B

By The Canadian Press Feb 4, 2020 | 12:14 PM

DUBAI, United Arab Emirates — Abu Dhabi’s long-troubled Etihad Airways said Tuesday it would sell 38 aircraft to an investment firm and a leasing company in a deal valued at $1 billion, the latest cost-cutting measure by the United Arab Emirates’ national carrier.

Etihad said it would sell 38 aircraft — 22 Airbus A330s and 16 Boeing 777-300ERs — in the deal with investment firm KKR and leasing firm Altavair AirFinance. KKR said the Boeing 777-300ERs will “be leased back to Etihad upon purchase in early 2020,” while the Airbus A330s will go to international clients.

Etihad described the move as being in line with “the third year of its transformation program.”

“The deal offers us flexibility while ensuring we stand by our sustainability targets and maintain a fleet of the most fuel-efficient, technologically advanced aircraft,” the firm said in a statement.

Since 2016, Etihad has lost a total of $4.75 billion as its strategy of aggressively buying stakes in airlines from Europe to Australia to compete against Emirates and fellow rival Qatar Airways exposed the company to major losses.

In the time since, it has embarked on a cost-cutting initiative and recently announced it would restructure planned aircraft purchases from Airbus and Boeing.

The airline reported revenues of $5.86 billion in 2018, down from $6 billion in 2017. It flew 17.8 million passengers last year, down from 18.6 million the year prior.

Previously, Etihad reported losses of $1.52 billion for 2017 and $1.95 billion in 2016. It blamed “challenging market conditions and effects of an increase in fuel prices” in part for the loss in 2018.

Abu Dhabi’s rulers launched Etihad in 2003, competing with the established Dubai government-owned carrier Emirates that flies out of Dubai International Airport only 115 kilometres (70 miles) away. In 2018, Etihad began loaning pilots to Emirates under a new program.

___

Follow Jon Gambrell on Twitter at www.twitter.com/jongambrellAP

Jon Gambrell, The Associated Press