Two aircraft leasing firms have rejected Kenya Airways’ proposals to reduce the cost of hiring their planes in a row that looks set to ground several planes. Kenya Airways chief executive Allan Kilavuka said the two lessors were opposed to their new payment term. A move that has seen them ground their planes at Jomo Kenyatta International Airport (JKIA) in Nairobi. KQ, said it could not reveal the number of planes affected so as not to jeopardise negotiations.
The State is pushing for the restructuring of KQ on the back of its multi-billion shilling bailout of the airline.KQ will be required to reduce its network, operate a smaller fleet, and possibly lay off more staff under the bailout terms.
“We are asking them to reduce their cost but some are not agreeable to the terms we are proposing. Until we agree, we want to put a pause to our relationship,” said Mr Kilavuka on Wednesday. “Two of them are not agreeable to the concession we are proposing. The other six are open to discussion and we have not signed up anything yet. Their planes are operational.”
The national carrier reached a deal with the lessors last year to only pay when they fly leased aircraft following the grounding of its services on the back of Covid-19, which saw planes remain idle.
The new arrangement has seen the cost of maintaining its fleet drop from Sh28.5 billion in 2020 to Sh16.6 billion last year.
