Monarch Airlines has cancelled its order for six B787-8s as part of wider plans to shift away from the charter model and towards the LCC model, according to Travel Weekly. As a result, Monarch will focus on short-haul international services, no longer requiring the range capability of the B787. The carrier has 30 aircraft in its fleet, including four A300-600Rs and two A330-200s, according to Ascend. It has no other orders at present.
Monarch Airlines cancels 787 order
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Global commercial aircraft deliveries fell in 2016 as Boeing again outsold Airbus; 2017 to be a peak
The global commercial aircraft fleet grew by 4% in 2016 and the year ended with an order backlog of more than nine years of production. Among the regions, North America still has the biggest and oldest fleet, but the lowest ratio of orders to aircraft in service. By contrast, Middle East has the fewest in service, but the highest ratio of orders to current fleet numbers.
This report gives an overview of the number of commercial aircraft deliveries in 2016 and the outlook into 2017 and beyond. It also looks at numbers in service and on order by region. It is based on preliminary numbers from the CAPA Fleet Database and guidance on 2016 deliveries from Airbus and Boeing, who have yet to announce final numbers.
The data indicate that total worldwide deliveries fell in 2016, the first such decline for six years, as a result of delays to new aircraft programmes. Boeing delivered more aircraft than Airbus for the fifth straight year, but its deliveries fell short of its 2015 level, while Airbus increased its numbers year-on-year. Total deliveries will likely rise again in 2017, but this may prove to be a peak year.
Monarch Airlines: group receives new cash from Greybull Capital but profit outlook is down
The latest investment in the Monarch Group by its majority shareholder Greybull Capital avoided the loss of its ATOL licences and the possible suspension of operations. Moreover, it has given Monarch the opportunity to bridge the gap between now and the planned delivery of the first of its new 30 Boeing 737MAX aircraft in 2018.
Nevertheless, Monarch continues to face significant challenges. Europe's short/medium-haul markets are feeling significant downward pressure on unit revenue – particularly in the leisure markets that Monarch serves. This is due to overcapacity and concerns about terrorism in key Monarch markets. Brexit and the sharp devaluation of GBP (it has fallen by 30% against the EUR over the past 12 months) are further challenges for the LCC.
Although Monarch quickly quashed rumours of its financial difficulties in late Sep-2016 and then secured new funds, its commentary indicated that its profit for the year to Oct-2016 would be lower than in the previous year. It has an uneven track record of profitability and has often flown with close to empty cash reserves. Those reserves have been partially replenished, but only sustainable improvements in profitability will avoid the need for further cash calls in the future.