Kuwait Airways restructured its order with Airbus SE, adding longer-distance single-aisle aircraft while reducing a commitment to the largest jetliners as it adapts to post-Covid demand.
The loss-making Gulf airline added three A321LR narrowbodies, which will be used to serve mid-size destinations such as Manchester, England, from Kuwait. It also upscaled six A320neos to the bigger A321neo model, Chairman Ali Al-Dukhan said Monday.
Al-Dukhan said he had made it his top priority to restructure a 2014 deal with Airbus to suit the airline’s future, with the need to be more flexible in a post-covid aviation industry. The state-owned carrier, which hasn’t made a profit since the Iraqi invasion in 1990, now hopes to break even by 2026, he said in an interview.
The airline aims to have a 60%-to-40% ratio of single-aisle and twin-aisle aircraft, Al-Dukhan said.
“Based on that, we moved things around, and Covid made that change more critical, Al-Dukhan said. “It would have restricted expansion and profitability otherwise.”
Kuwait Airways may lease some planes to get to the target as the restructured deal brings the ratio to about 50-50.
‘Stronger Place’
The new deal positions the airline “in a much stronger place to succeed for the next 15 years,” Al-Dukhan earlier told a press conference. About 40% of the newly-restructured $3 billion deal has already been paid and the remainder will be arranged through bank loans, he said.
The shuffle takes Kuwait’s eventual Airbus fleet to 31 aircraft. It also has 10 Boeing Co. 777s in operation.
Three A350-900s were removed, leaving the airline with two on order. A commitment to the A330-800 was cut by four, while seven A330-900s were added.
The majority of planes in the deal will arrive by 2026, while delivery of the A350s has been pushed back to 2028, Al-Dukhan said. He said paint issues with the model that have led to a dispute between Airbus and Qatar Airways should be resolved by then.
Several other airlines have made similar changes, adding Airbus’s popular A321—which can fly longer routes more economically—while cutting exposure to expensive wide-body models.