By Rob Morris
UPDATE 1: Budget carrier announces $320m sales and leaseback agreement for aircraft.
Budget carrier flydubai has agreed a $320m sales and leaseback agreement for four aircraft with GE Capital Aviation Services, it announced on Wednesday.
The deal involves four of the 50 Boeing 737-800s, worth $4bn at list price, that Dubai’s low-cost carrier announced last year in Farnborough. Two will be delivered this month while the remaining planes are scheduled to arrive in October and December.
“This is a significant deal for flydubai as it is the first financing that we have secured outside the UAE,” flydubai CEO Ghaith Al Ghaith said.
“This deal ensures our financing needs for the rest of 2009 when we will receive a further four aircraft by the end of the year and allow flydubai to operate to around 14 destinations.”
Al Ghaith declined to comment on market conditions and why the airline completed the deal during tough economic times.
He also said the airline was in no position to discuss flydubai’s seat factor loads following its June launch.
“One month of operation is not enough to discuss that, so maybe after a longer of period of time we can,” Al Ghaith said.
The financing was completed in a matter of weeks, according to Doug Winter, GE Capital’s senior vice president and region manager for the Middle East, Africa
“It [the deal] further expands our already significant presence in the Middle East market,” he added.
Since launching last month, flydubai has introduced flights to Beirut, Amman, Damascus and Alexandria and Aleppo.
It is also planning to start flights to three Indian destinations later this month.
flydubai will begin its Indian routes with flights to the north eastern city of Lucknow on July 13.
This will be followed by Coimbatore in the south of the country on July 14.The trio of destinations will be completed on July 23 when flights to the north western city of Chandigarh begin.
It is expected to have between 14 and 16 destinations by the end of 2009.