(MENAFN-Khaleej Times) Hogan, who was in Rome on Friday where he met the board of directors and senior management of the loss-making airline along with the ministers of finance and transport and other top officials, discussed the issues related to the investment
Etihad Airways is carrying out due diligence of troubled Italian carrier Alitalia, chief executive officer James Hogan said.
Hogan, who was in Rome on Friday where he met the board of directors and senior management of the loss-making airline along with the ministers of finance and transport and other top officials, discussed the issues related to the investment.
“We are very clear what we would expect as investors, and we are clear how they consider the airline could be restructured,”he told a reporter at a Press briefing.
“As we’re sitting here... we have made no commitment, we are working through the process... we have to be convinced as an investor stepping in that we can do to move the airline back to profitability in conjunction with the management,” Hogan said.
He discussed wide-ranging issues in the Press conference.
Fuel cost was the largest expense last year, as it spent $2.2 billion, though prices remained stable. However, the airline had hedged 78 per cent of its fuel requirements, which this year will be reduced to 75 per cent.
Since the hedging was introduced in 2007, he said the airline has saved $500 million in fuel costs.
On the raising funds to finance the purchase of new aircraft, Etihad Airways chief financial official James Rigney said less than $2 billion will be raised to financing the purchase of three A380s, two A320s and five 777s this year. Rigney said that the airline is evaluating requests for proposals issued for buying the A330s and A320s. Financial institutions from across the globe have shown strong interest in the financing.
Rigney said that requests for acquiring five 777s aircraft would be issued shortly and for buying two new types of aircrafts-A380s and 787s. Request for proposals would be issued in April.
In 2013, the airline received 16 passenger jets, of which 11 were new aircraft — six wide-bodied Boeing 777-300ERs, four narrow-bodied Airbus A320-200s and the airline’s first Airbus A321.
There were also five wide-bodied Airbus A330-200s obtained from Jet Airways, three of them leased and two purchased.
Etihad Cargo added three new freighters — two Boeing 777-200Fs and one Airbus A330-200F. It also “wet leased” a Boeing 747-400ERF from KLM Royal Dutch Airlines, and a Boeing 747-8F from US operator Atlas Air to replace two older aircraft.
In November 2013, Etihad Airways signalled its long-term growth intentions when it announced the largest fleet order in its history for up to 199 aircraft and 294 engines, at a current list price of approximately $67 billion.
Firm orders were announced for 87 Airbus and 56 Boeing aircraft, with 56 options and purchase rights to support additional growth opportunities, not only for Etihad Airways, but potentially for members of its airline equity alliance. The new aircraft deals also include rights to defer deliveries if required.
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