airBaltic signed (10-Jul-2012) a LoI to acquire 10 Bombardier CSeries CS300 aircraft and take purchase rights on an additional 10 CS300 aircraft. A firm order contract would be worth USD764 million which could increase to USD1.57 billion if purchase rights are converted to firm orders. airBaltic CEO Martin Gauss said, "As we look to replace the older aircraft in our fleet, matching the requirements of our business plan, we reviewed the narrowbody platforms from the major airframers and determined that the all-new CS300 aircraft was the best fit." [more - original PR] [more - CAPA Analysis]
airBaltic signs LoI for up to 20 Bombardier CSeries aircraft
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airBaltic: the hybrid LCC punches above its weight; back to growth and positive EBIT in 2016
For Latvia's national airline, 2016 was a pivotal year. Riga-based airBaltic completed a multi year restructuring programme, increased its passenger numbers for the first time in five years, secured a capital increase and a private investor, and became the launch customer for the Bombardier CS300. On 28-Mar-2016 it further celebrated its successes by announcing a return to positive EBIT, alongside a net profit, for last year.
It has achieved its turnaround in the face of strong competition from foreign LCCs, justifying its positioning as a "hybrid LCC". Data provided to CAPA confirm that its unit cost level is also broadly consistent with the LCC tag. It is now seeking further investment from a strategic investor – preferably another airline. It also faces a decision about the replacement of its Dash 8 turboprop fleet.
AirBaltic CEO Martin Gauss told CAPA that the airline plans for passenger growth to accelerate from 12% in the past year to 16% in 2017, taking traffic levels back above 3 million passengers. For an airline based in a country inhabited by only 2 million people, this suggests that airBaltic has been making some judicious network decisions.
airBaltic reaps rewards of restructuring rigour in Riga. Launch operator of CS300 returns to growth
On 28-Nov-2016 airBaltic took delivery of the world's first Bombardier CS300 for commercial service, which will begin on 14-Dec-2016 with a flight from Riga to Amsterdam. It will receive a further 19 of the aircraft variant by 2019.
Just five years ago airBaltic was heavily loss-making and close to bankruptcy. Under CEO Martin Gauss Latvia's national airline has negotiated a successful restructuring programme, established a track record of growing profits, secured a private investor alongside the national government, made significant load factor gains, and is now returning to capacity growth.
The new CSeries order should allow airBaltic to build on these achievements by replacing its ageing Boeing 737s with one of the most modern and efficient narrowbodies aircraft in the world, while also providing additional growth capacity. Together with its Dash-8 turboprop aircraft this purchase should give it a fleet well adapted to the niche needs of a hybrid regional hub airline based in northern Europe's smaller markets.