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$170mn to be paid for airbus cancellation: Ravi
Sri Lanka will pay $170 million to AerCap Holdings NV, the world's largest independent aircraft leasing company, for cancelling four A350s ordered by the previous government, Finance Minister Ravi Karunanayake said on Tuesday.
The move comes as the government is in the process of finalizing a partner to revive the national carrier. It canceled four of eight A350 aircraft orders with Airbus Group SE.
"The cost will be $170 million for the cancellation and it will be paid for AerCap," the finance minister had told Reuters.
Minister Karunanayake later told Parliament that the state-run Sri Lankan Airlines do not require A350s as its longest flight time is around 10 hours.
Government officials have said the remaining four A350s are scheduled to be delivered towards 2020 but the government is yet to take a decision on them.
Sri Lankan Airlines, which has taken on lease seven Airbus A330-300s since 2012, has debt of around $3.25 billion.
It posted a group net loss of 16.3 billion rupees ($112.6 million) for the financial year through March 31, narrowing from the 31.4 billion rupees loss of a year earlier, due to lower oil prices. The carrier last posted a profit in 2009, a year after Emirates sold its stake in the venture.
The company also leased four of its Airbus A330 planes to Pakistan International Airlines Corp.
One of the Airbuses ordered and then cancelled by SriLankan airline is seen in Toulouse, France in July.
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