United Airlines not likely to take delivery of 42 outstanding A319/320 orders
07 Aug 2008
United Airlines has said it was ''highly unlikely'' that it would take delivery of the remaining 42 Airbus A319/A320s it has on order. If it goes ahead with the cancellation the decision would cost the carrier more than $90 million in lost aircraft deposits.
The airline has orders for 23 A319s and 19 A320s. It disclosed in a 10-Q financial filing with the US Securities and Exchange Commission that it was likely to cancel the orders. "United believes it is highly unlikely that it will take delivery of these [42 Airbus] aircraft in the future, and therefore believes it will be required to forfeit its $91 million of advance delivery deposits," the airline says.
It also pointed out that the deposits are "not transferable". It also said that the purchases were still included under its total commitments, "as the company has not formally terminated the orders".
In a previous 10-Q submission, filed in May, United said it had reached an agreement in January 2006 with the manufacturer to "delay, with the right to cancel" these future orders.
