Lion Group fleet: slowing aircraft deliveries a good strategy

The Lion Group has slowed its new aircraft deliveries for three consecutive years, from a high of 57 in 2015 to only 23 in 2018, and could take even fewer aircraft in 2019 as it contemplates cancelling orders for more than 200 737 MAX family aircraft. Another round of deferrals and even reductions (with Airbus and/or Boeing) would be sensible, given that all three of the airlines that the group launched in 2013 have concluded initial buildout periods.

Batik Air, Thai Lion Air and (particularly) Malindo Air have stopped pursuing rapid growth, ending an initial period of rapid strategic expansion. The group's original airline, Lion Air, is also unlikely to resume rapid expansion, having slowed significantly in recent years as the Lion Group shifted focus to new markets and segments.

Lion Group founder Rusdi Kirana threatened, in several Dec-2018 media interviews, to cancel all its remaining orders with Boeing. The threat came in the aftermath of an allegedly damning Boeing statement regarding Indonesia's preliminary report on the 29-Oct-2018 Lion Air 737 MAX 8 accident, which infuriated Lion.

However, Lion already needed to adjust its delivery stream before the accident, and the recent discord with Boeing will accentuate that momentum.