Avianca to retire last MD-80 in early 2010

Washington DC
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Avianca is planning to phase out its last Boeing MD-80 in the first quarter of next year and will also retire its last Boeing 757 in 2010.

When deciding in 2007 to replace its fleet of 16 MD-80s with new Airbus A320s the Colombian carrier set a retirement date of December 2010. This was moved up to December 2009 last year when Avianca decided to accelerate its A320 deliveries but CEO Fabio Villegas says the last three MD-80s will now be phased out in the first quarter of next year.

Villegas says Avianca is now operating nine MD-80s and six of these will be replaced by A320s scheduled for delivery before the end of 2009. According to Flightglobal's ACAS database Avianca now operates four A319s and four A320s. Villegas says the carrier will have 16 A319/320s in its fleet by year-end and will receive 10 more next year, including seven for Avianca and three for Brazilian sister carrier OceanAir.

As part of the same Airbus order placed in 2007, Avianca also now operates four A330s with a fifth to be delivered later this year and five more to be delivered from 2011. Villegas says under the original delivery schedule from the roughly 60-aircraft order placed with Airbus in 2007, Avianca was only going to take about five aircraft per year but was able to accelerate the intake to eight last year, 13 this year and 10 next year.

"With the level of demand that Airbus had at that time they could only provide four or five airplanes per year. [But with the economic crisis] a lot of airlines have [deferred slots] and we have been able to accelerate dramatically the re-fleeting programme," Villegas told ATI sister publication Airline Business Magazine in an interview last month.

"The case for us was clear. We are not growing and this is not additional fleet. What we are doing is changing old fleet for new fleet. The aim is basically to increase the financial operational margin and reduce the operational cost. Re-fleeting for us and accelerating the re-fleeting program is part of the solution itself to the crisis."

Villegas says Avianca had the flexibility to accelerate A320 deliveries because it owned eight of its MD-80s. He says its leased MD-80s are being returned as originally scheduled at the expiration of their leases while the owned aircraft are now being phased out faster.

Villegas says the eight owned aircraft will be sold. Avianca earlier this year announced a deal with BAE Systems' asset management arm to handle the remarketing of its MD-80s.

Villegas says the accelerated A320 delivery schedule also has allowed Avianca to speed up the retirement of its 757s. ACAS lists Avianca as still operating six 757s. "Basically next year we'll get rid of them," Villegas says.

He adds Avianca owns only one of its 757s. He says this aircraft will be sold or could be operated by another carrier in the Synergy Group. In addition to Avianca, Synergy owns OceanAir and Ecuador's VIPSA and has been negotiating a potential acquisition of a majority stake in 757 Ecuadorean operator AeroGal.

Avianca for several years has been using MD-80s in two-class configuration on domestic trunk routes and short to medium-haul international routes while the 757s have been used mainly on medium-haul international routes. The MD-80s and 757s are being mainly replaced by A320s while A319s have been used to open new medium-haul international routes such as Bogota to Santo Domingo and Washington Dulles.

The MD-80 has been the backbone to Colombia's air transport network for several years, operating most flights on the main domestic routes as well as several of the main international routes including Miami. Only three three years ago there were over 30 of the type operating in Colombia. But when the last Avianca MD-80 is retired early next year it will mark the end of an era in Colombia as the country's other major domestic carrier, Aero Republica, plans to retire its last MD-80 late this year. Aero Republica, which previously operated an all MD-80 fleet consisting of about 15 aircraft, will have an all E-190 fleet at year-end also consisting of 15 aircraft.