airBaltic asks court to let it exit leases on six A220 aircraft
Latvian airline airBaltic has asked a US bankruptcy court for permission to walk away from leases on six Airbus A220-300 jets and to approve a simplified procedure for returning them. The company expects to shrink its fleet further.
Latvia's national airline airBaltic has asked the US Bankruptcy Court for the Southern District of New York, where it is going through Chapter 11 restructuring, to allow it to reject the leases on six Airbus A220-300 aircraft. It wants the rejection to take effect on 17 November. Chapter 11 is a court-supervised US procedure that shields a company from creditor claims while its obligations are restructured. The request is part of a plan to cut the fleet and stabilise the company's finances.
Which aircraft are affected
All six jets are at Riga airport. Their registrations are YL-CSI, YL-ABD, YL-ABE, YL-ABF, YL-BTC and YL-BTD. The first four were delivered in 2018 and 2021, and the last two in February this year. The lessor in every case is listed as Wilmington Trust SP Services (Dublin) Limited, with Azorra group companies, and for one aircraft also Artemis Funding Limited, named as additional notice parties.
Why the airline wants out
According to airBaltic, it carried out a long-term fleet assessment with advisers before the restructuring began. It concluded that these six aircraft are not needed for future operations and that their lease terms exceed current market rates for comparable aircraft. Any rejection of further aircraft or engine leases would need separate court approval. Michael Cox, chairman and chief executive of financial adviser Seabury Global Advisors, said in a court declaration that the new business plan involves reducing surplus aircraft, obtaining concessions from key contract partners and carrying out a profit improvement programme. He added that it also requires additional liquidity and a recapitalisation of the balance sheet.
Proposed return procedure
The airline proposes a simplified process: aircraft and equipment would be handed over as-is, where-is, without warranties on their condition. airBaltic could remove Starlink satellite internet equipment before handover. Lessors would have to collect the aircraft within 15 days of a court order, after which they would bear storage, insurance and maintenance costs.
Fleet and financing
airBaltic currently operates 54 Airbus A220-300 aircraft, 46 of them on operating leases and eight owned. On 19 October the court approved a debtor-in-possession (DIP) financing structure of up to €350 million. A hearing on the request is set for 17 November, and objections are due by 10 November. The airline says flights will continue as normal, and the process could end in mid-2027.
