Israir Group’s board has approved adding another pair of Airbus A320s to the Israeli airline’s fleet in the second quarter of this year.

The airline says that this would bring its fleet up to eight A320s, of which three will be owned and five will be operated on long-term dry-lease.

It has a tentative agreement, centred on a memorandum of understanding, with a foreign company to supply the aircraft.

Israir Group expects the lease period for the jet to be around six years.

It says the parties will work towards signing a final lease agreement by 29 March.

Israir A320-c-Israir

Source: Israir Group

Israir had suspended fleet expansion after the outbreak of the Gaza conflict

“[Israir] sees the aircraft lease as a strategic opportunity to strengthen the position of the company’s aircraft fleet, and improve the capital structure, [earnings] and cash flow during the coming years,” the operator adds.

It had suspended expansion of the fleet late last year, when it had six aircraft, as a result of the Gaza conflict. The airline had a preliminary agreement with a Chinese company for two more A320s.

But in a presentation to investors on 20 February, the carrier revealed that its activity over the first two months of the year had generated 15% passenger growth.

Israir adds that it increased utilisation, performing 2,300h of flights compared with 1,700h last year despite operating 25% fewer aircraft on average.

The company typically brings in three wet-leased aircraft each year to reinforce capacity.

But the Gaza conflict has increased insurance costs, while some wet-lease crews have been reluctant to stay in Tel Aviv.

Israir Group says it has been negotiating with the Israeli ministry of finance to place these aircraft under an Israeli insurance umbrella, but the talks have yet to yield a positive outcome.

Strategic measures to counter the effects of the conflict include basing the leased aircraft in Europe, and flying routes in the opposite direction.