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Kuwait Airways faces possible delays of up to 12 months to receive some Airbus aircraft, its CEO said on Wednesday. The government-owned carrier signed a multi-billion dollar deal with Airbus in 2022 for 31 planes, 18 of which it has already received.
Maen Razouqi said in an interview that any financial impact as a result must fall on the party causing the delay. “We don’t get into disagreements; the reality is that there are financial obligations that must be borne by the party responsible for the delay,” Razouqi said.
“This is part of our restructuring discussions- that the financial obligations should be based on payments or credits… offset for the delay,” he said, adding discussions take place on a plane by plane basis.
Kuwait Airways posted a net loss of 55 million dinars (USD 178.94 million) for 2022, but aims to achieve its first profit in 2025, the CEO said.
The world’s largest aircraft lessor said airlines will have to fly old planes for longer as a result, benefiting lessors who have increased lease rates sharply and sold older aircraft at higher margins since the post-pandemic recovery in travel. AerCap also launched a new USD 500 million share buyback programme on July 31 after growing its second quarter revenues by 15% year-on-year to almost USD 2 billion.
Regional airlines, like their global counterparts, were hit hard by the Covid-19 pandemic, but many Gulf carriers have seen a swift pick up in demand, and are key players in the regional drive to diversify the economy into sectors such as tourism. Razouqi said the company plans to increase passenger numbers to 5.5 million by 2025 and is negotiations to lease six to eight aircraft for 12 years, adding there is “intense competition” to lease it planes because its payments are not delayed.
As part of expansion plans, Kuwait Airways wants to increase its fleet to 50 by 2030, of which eight to 10 aircraft will be leased.
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