Peter Bellew says global lessors and lenders will finance the purchase of the aircraft and then lease the planes to Malaysia Airlines.
Malaysia Airlines Bhd (MAB) declares that MAS will not finance and own the 16 new Boeing aircraft it is buying.
Instead, The Malaysian Reserve reported, it would sign leasing arrangements with global lessors and lenders who would foot the bill for the planes.
The deal with Boeing was inked during Prime Minister Najib Razak’s visit to the US last week.
The report quoted MAB CEO Peter Bellew as saying large global leasing firms and lenders would purchase the aircraft and then lease the planes to MAB on an operating sale and leaseback agreement.
These aircraft will not be owned by Malaysia Airlines, but are planned to be on operating leases, which is a norm in modern airlines,” he said in an internal memo dated Sept 15 which was seen by The Malaysian Reserve.
The deal includes eight 787-9 Dreamliners by converting a previous order of eight Boeing 737 MAX and eight 737 MAX 8s. Boeing’s Global Fleet Care service is also thrown into the deal.
Although MAB had justified the purchase as part of its plan to become a premier airline, sceptics had questioned the purchase, especially when it had yet to return to profitability, the report said.
In a lengthy and detailed memo to the airline’s 14,000 staff, Bellew said the recent purchase of the Boeing MAX and the 787-9 Dreamliners coincided with the end of the other lease agreements.
According to the report the first of the eight wide-bodied Boeing 787-9 Dreamliners, with a list price of US$2.5 billion (RM10.5 billion), was expected in the third quarter of 2019.
Bellew said the airline’s current 48 737-800 fleet would reach the end of the lease period from early 2019.
He said the Dreamliners gave the company complete flexibility to manage a variety of market opportunities over the next 20 years.
The Malaysian Reserve quoted Bellow as saying: “In all of this, I would like to reiterate that as of now, we have a firm order of 25 Boeing 737 aircraft with everything else being optional.”