Cathay Pacific announced some dire results for the first half of the year, loosing a staggering US$1.13 billion in the first half of the year, its worst results in its 70 year history.
The CEO said, in the most understated way, that it was “the most challenging” time in its history and warned that the second half of 2020 was going to be painfully bad.
One of the biggest questions for analysts was would the airline cancel the 21 aircraft order for the 777-9? The answer appears to be no, but they are negotiating with Boeing for a lengthy deferral, out to as far as 2026.
There was a lot of rumour that the airline would swap the 777-9 for the 787-10, but they seem happy to keep the -9 as long as they can put it off for up to five years.
The airline is about to go through a refinancing and fiscal restructure, backed by a government credit facility, and part of that is an agreement to settle with Boeing over the 737MAX groundings and order.
The details of the final settlement with Boeing are confidential. What has been revealed is that it reduces Icelandair’s MAX purchase commitment by four aircraft, and the delivery schedule for the remaining six MAX aircraft ordered has been postponed from the second quarter of 2021 to the first quarter of 2022.
Furthermore, the settlement provides additional compensation for Icelandair which covers a substantial portion of the damages incurred from the groundings and will mostly be paid by the second quarter of 2021. Estimates place the compensation package at around US135 million.
EVA Air are in negotiations with Boeing to delay and reduce their 787 order.
The original order was for twenty four 787-10’s and ten have so far been delivered. The airline is said to be considering cuts of up to 8 of the remaining order and delaying the rest by at least two years.
EVA is one of the few airlines operating most of its fleet, with 75 of 84 aircraft currently operational. This is mostly down to the extremely effective anti-Covid measures on the island which kept the pandemic under tight control.