Avation To Remove Five Aircraft From Virgin Australia Fleet

Singapore-based lessor Avation company on Friday announced the removal of five Virgin Australia aircraft from the carrier’s fleet.
The lessor has decided to take back three ATR 72-500s and two Fokker 100s since Virgin Australia entered administration in April.

In a statement, the aircraft leasing company has entered into commercial arrangements for the five aircraft. According to Jeff Chatfield, Executive Chairman of Avation, the COVID-19 situation has not deterred its marketing team from securing deals with new clients.

“Given this unusual and disrupted environment, Avation is pleased and grateful that its marketing team was able to establish a lease with a new client,” Chatfield explained.

Regarding two of the three turboprops, Avation made arrangements with an undisclosed commercial airline in Australia. Thus, the airline in question will receive two of the ATR 72-500s until the end of 2021.

Avation signed a conditional letter of intent for the last ATR 72-500. Another airline will receive the aircraft under a five-year lease.

All the established turboprop deals were at current market lease rates.

For the two Fokker 100 jets under Virgin Australia’s regional fleet, the lessor secured financial leases over the period to September at 6% above book value.

Although Avation has managed to secure deals with no lingering issues, the lessor remains strategic. It still has ATR 72-600s with Virgin Australia that it does not plan to remove. In an official statement, Chatfield said,

“We are optimistic that Virgin Australia will be sold by the Administrator and that the eventual buyer should see the value in maintaining and indeed growing the regional network using Avation’s remaining ATR 72-600s as a part of the future business. We feel it prudent to mitigate our overall risk by selling down and transitioning certain of the aircraft given the uncertainty that surrounds the present COVID-19 environment.”

Culled from simpleflying.com

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