airBaltic seeks court approval to reject leases on six A220-300s

The application covers only those six leases, according to documents filed with the US Bankruptcy Court for the Southern District of New York. The airline says it continues to assess fleet requirements and expects further reductions through additional aircraft and spare engine returns.

All six aircraft are at Riga Airport. The registrations are YL-CSI, YL-ABD, YL-ABE, YL-ABF, YL-BTC and YL-BTD. Wilmington Trust SP Services (Dublin) Limited is listed as lessor for all six. Companies in the Azorra group are named as additional notice recipients, and Artemis Funding Limited appears in the case of one jet.

The six are among the 54 A220-300s airBaltic operates, but the airline stated that they were "no longer necessary for future operations" and were no longer included in its fleet or business plans. It also says their lease terms exceed current market rates for comparable aircraft. airBaltic has asked the court to approve a simplified return procedure. Under the proposal, it would provide no representations or warranties on the equipment's condition or ownership status, and it would not have to repair aircraft to operational condition. Lessors would collect the aircraft within 15 days of the court order authorising rejection. After that, lessors would bear storage, insurance and maintenance costs. airBaltic would retain the right to remove Starlink equipment before return.

According to LETA archives, YL-BTC and YL-BTD, the last two on the list, arrived in February this year as the airline's 53rd and 54th A220-300s.

Fleet plan cuts 54 aircraft to 36

The business plan calls for reducing the fleet from 54 A220-300s to 36 by the end of 2026, according to Aviation Today. It targets about 40 aircraft by 2031. A court declaration cited by Baltic News Network says the plan involves returning about 20 surplus aircraft and achieving annual cost savings of about 45 million euros.

Lease liabilities and cash

The filing puts operating lease liabilities for 46 aircraft and seven engines at 855.6 million euros. That compares with the roughly 45 million euros in annual savings the fleet plan targets. Stefan Krastev, vice chairman of Seabury Global Aviation Advisors, says in a court declaration that airBaltic had 1.13 million euros of cash on the day it filed for Chapter 11. He says the airline needs about 350 million euros of new financing; without it, he says, airBaltic would suspend flights and ultimately face liquidation.

airBaltic has binding commitments for up to 350 million euros of debtor-in-possession financing and has received a first tranche of 140 million euros. Of that tranche, 78.925 million euros will be used to buy eight aircraft and seven engines.

What happens next

The 17 November termination date depends on the bankruptcy court approving the application. Any further aircraft or engine returns would need separate court approval.