Extract from the group results released this morning...
Aircraft fleet replacement
Thomas Cook Group operates a fleet of 93 aircraft with an average age of 12 years. The Group has identified significant operational savings, particularly from maintenance and improved fuel efficiency, that can be achieved by renewing and harmonising its 71 narrow body aircraft onto a common fleet. Following a comprehensive review, the Group has selected the Airbus 320 family of aircraft. Accordingly, the Group will begin a five year narrow body aircraft replacement programme, starting in December 2012 and phased in line with the planned retirement of the existing fleet. The replacement programme will deliver optimum flexibility by sourcing new narrow body aircraft through a combination of firm and flexible orders direct with the manufacturer and through accessing the aircraft leasing market. A review of the wide body fleet replacement requirements will be undertaken during the 2010/11 financial year.
As part of the replacement programme, the Group has reached a memorandum of understanding with Airbus for 12 new Airbus 321 aircraft scheduled to be delivered in 2014, with a list price of $96 million each, together with options to purchase further aircraft from 2015. These aircraft are subject to substantial price concessions from the list price. The Group will remain a heavy user of operating leases and it is anticipated that directly purchased aircraft will be financed through sale and leaseback agreements with third party lessors.