Scandinavian carrier SAS has announced a sale and leaseback (SLB) agreement with lessor Aviation Capital Group (ACG) for 10 Airbus A320neos. The airline continues to seek favorable financing deals with aircraft lessors amid its restructuring process.
SAS sale-leaseback for 10 A320neos
SAS has secured “competitive financing” for the 10 Airbus A320neos with US-based lessor ACG in its latest agreement with leasing firms. Generating capital via SLB agreements is one of the most effective methods of maintaining liquidity as the airline continues to implement its ‘SAS FORWARD’ transformation plan.
Anko van der Werff, President and CEO at SAS, commented,
“We continue to make progress with our transformation plan and these new sale and leaseback agreements are an important part of that – securing competitive financing for our renewed fleet of modern and fuel-efficient aircraft. We are pleased to renew our long-term strategic partnership with ACG, one of the world’s leading aircraft financing partners.”
Data from ch-aviation shows that the airline has over 20 Airbus A320neos awaiting delivery, which would take its A320neo fleet to over 55, in addition to the 21 A320neos wet-leased to subsidiary SAS Connect. The first deliveries in its agreement with ACG will commence in the first quarter of 2024 – SAS will also welcome a further six A320neos on lease from Irish firm Griffin Global Asset Management, with all six jets set to arrive this year.
Tom G. Baker, CEO and President of ACG, added,
“ACG is honored to welcome SAS as a renewed strategic partner. We are delighted to support the SAS FORWARD transformation plan with this sale-leaseback transaction for SAS’ latest technology and fuel-efficient aircraft.”
Fleet changes
Major changes have been made to the SAS fleet since it first filed for Chapter 11 bankruptcy in July as it looks to trim expenditures wherever possible. This has included returning dozens of leased aircraft – including two Airbus A350-900s and three Airbus A330-300s – to their owners, before renegotiating leasing agreements for 36 aircraft owned by 10 different lessors in October 2022. By January this year, the carrier said that it had renegotiated contracts for a total of 59 of its aircraft with 15 different lessors, helping it to achieve annual cost savings of at least 1 billion Krona ($95 million) through reduced leasing expenses.
Most recently, the carrier petitioned a United States bankruptcy court to allow it to return two surplus aircraft – an Airbus A330 and Airbus A320neo – to lessors. At the time of its bankruptcy filing in July, the majority of the airline’s 100-strong fleet had been acquired through some form of leasing agreement, with over 60 planes on conventional operating leases and another 15 via Japanese operating leases with a call option (JOLCO).
Bankruptcy protection over soon?
As Simple Flying reported last week, SAS expects to leave bankruptcy protection this year and has made some progress in narrowing its losses, albeit slight. The airline recorded a pre-tax loss of 2.49 billion Krona ($239 million) for the latest financial quarter, a minor improvement on its 2.60 billion Krona ($249 million) losses the year prior.
In fact, the carrier is projecting a return to profitability in 2024 and has seen load factors steadily go up in recent months. The carrier plans to undergo a recruitment drive before summer 2023 in order to meet rising demand.
