Founder of easyJet Stelios Haji-Ioannou says it’s ‘scandalous’ the airline should spend £4.5bn with Airbus when its planes are grounded and it is taking £600m in Government-backed loans. Tony McDonough reports
Low-cost airline easyJet has agreed to delay the delivery of 24 new Airbus aircraft as it looks to head off a showdown with founder and biggest shareholder Stelios Haji-Ioannou.
The carrier, which operates more than 30 routes out of Liverpool John Lennon Airport, has an agreement with Airbus to purchase 107 planes with a total price tag of £4.5bn over the next three years.
But Stelios, who founded easyJet in the mid-1990s, said that kind of outlay would be “scandalous” when the company has grounded all of its aircraft amid the coronavirus crisis and was bringing in no revenue. It is also taking £600m in taxpayer-backed loans.
Now easyJet has said it would defer the delivery of 10 planes this year, 12 next year, and two in 2022. But this has failed to placate Stelios, who said: “A deferral is the same as kicking the can down the road.
“In addition they are not telling the investors how many Airbus aircraft will easyJet go ahead and pay Airbus for and how much per aircraft during the next six months using UK taxpayers money.”
Stelios, called a shareholder meeting to remove two of easyJet’s directors if the airline does not cancel the orders to reduce its planned £4.5bn in spending up to 2023. The carrier says the meeting will go ahead by May 7.
Johan Lundgren, chief executive of easyJet, said airlines were now facing “unprecedented challenges which require unprecedented action”. He added: “We remain completely focused on improving short-term liquidity and reducing expenditure across the business.”
Airbus, which employs around 6,000 people at its wing-making plant at Broughton near Chester, is also cutting back production of aircraft by a third as most of its airline customers face significant falls in revenue due to the coronavirus outbreak.
The company had delivered 122 aircraft during the first quarter of 2020, but a further 60 were produced but remain undelivered. Chief executive Guillaume Faury said: “We are in constant dialogue with our customers and supply chain partners as we are all going through these difficult times together.”