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Virgin Australia defers first 737 Max to 2021 in order rejig

Virgin Australia has deferred delivery of its first Boeing 737 Max aircraft to July 2021 and upsized 15 orders from the Max 8 to the larger Max 10 variant.

The changes will now mean that it has 25 Max 10s and 23 Max 8s on order, and its first re-engined jet will now be a Max 10. The first Max 8 will now be delivered in February 2025, almost six years later than the November 2019 date previously planned.

Virgin chief executive and managing director Paul Scurrah says the changes offer several benefits.

“This includes a significant deferral of capital expenditure by extending the use of existing aircraft given the relatively young age of our fleet along with providing the group access to the superior economics of the Max 10 aircraft,” he adds.

Cirium’s Fleets Analyzer shows that Virgin has 78 737-800s and two -700s in its fleet, while budget unit Tigerair Australia operates five -800s. The average age of the fleet is 8.8 years.

Referencing the global grounding of the 737 Max fleet following the ET302 and JT610 accidents of recent months, Scurrah says that while the airline would not introduce a new aircraft to its fleet unless it was satisfied with its safety, it still has faith in the re-engined type.

“We are confident in Boeing’s commitment to returning the 737 Max to service safely and as a long-term partner of Boeing, we will be working with them through this process.”

The deferral seems to signal that Scurrah, who took over as the airline’s chief executive in late March, will continue the airline’s focus on lowering capital expenditure to boost its cash generation and reduce its debt.

Scurrah took over the reins at Virgin from retiring chief executive John Borghetti on 25 March.

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