Fiji Airways Enters Into $500 Million Lease Agreement For 5 Boeing 737s

New aircraft to replace current narrow-body fleet

By Monika Singh

SUVA, Fiji (Fiji Times, ) – Fiji's national carrier Fiji Airways has secured a $1 billion ($US500 million) deal through a consortium for five new Boeing 737 MAX 8 aircraft over a 12-year lease agreement.

However, Fiji Airways managing director and CEO Andre Viljoen said they were not in a position to disclose how much they were supposed to pay to Boeing because of a confidentiality clause.

Mr Viljoen said they had secured a package deal with Boeing, leasing company GE Capital Aviation Services (GECAS) and engine manufacturers CFM International which included a 12-year sale and leaseback financing arrangement.

At a press conference in Suva yesterday, Mr Viljoen said the new Boeing 737 MAX 8 aircraft would replace its existing narrow-body fleet.

The first two of the five brand new B737 MAX 8 aircraft will arrive in 2018, and the remaining three will arrive in 2019.

"This is a major capital decision that had to be done correctly so we followed a rigorous, thorough and transparent process to find the right solution," said Mr Viljoen.

"As a consequence of the fierce competition between the rival bidders and the extensive process followed by Fiji Airways, we have achieved a ground-breaking package deal that represents excellent value for our shareholders, customers and stakeholders."

Mr Viljoen said they were satisfied that the B737 MAX 8 aircraft met their requirements for efficient performance, more engine power, greater economics and a product that will assist the company achieve 4-Star Airline SKYTRAX rating.

"Our team will now work on the cabin designs and fit-outs to Fiji Airways specifications. With 170 seats, we will continue with our existing two-class configuration (Business and Economy) and be able to offer an extremely competitive short and medium haul product.

"We are committed to growing and providing value to our key markets, and this investment in the Boeing 737 MAX 8 will give our customers less cabin noise, enhanced interiors, better lighting and more overhead cabin space. We are confident that this announcement will be very well received by our travel partners and our customers across our global network."

Mr Viljoen said they had new A330 and A300 and they were looking to upgrade them to a newer version which was 900 or the 800 going forward.

"And once we add these 737 MAX, we will have one of the newest fleet in the world," he said.

Attorney-General and Minister for Economy Aiyaz Sayed-Khaiyum said the addition of these new state-of-the-art aircraft from 2018 would continue the modernisation of the Fiji Airways fleet that Government began three years ago with the delivery of the first wide-bodied A330-200.

"Now that we are adding new and very efficient Boeing 737 MAX 8s, Fiji Airways will have one of the youngest fleets in the Asia Pacific, which means not only lower operating costs and a smaller carbon footprint, but a level of comfort and service for the travelling public that represents yet another leap forward for our national airline.

"This relationship with Boeing will also mean that Fiji Airways will be able to set up a flight simulator school and related aircraft training and specialisation here in Fiji. This will not only save us considerable expense in the training of our pilots but establish Fiji as a regional aviation training hub," he said.

Fiji Times Online.
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