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Full scale fleet renewal for Olympic Airways

The Board of Directors of Olympic Airways<.> approved, by a majority vote today, the contract for the company`s fleet renewal, after the completion…

The Board of Directors of Olympic Airways<.> approved, by a majority vote today, the contract for the company`s fleet renewal, after the completion of which the average age of its fleet will be reduced to 5 years from 15 years.

The strategy of the company as it was stated in its Business Plan and fleet planning, includes further aircraft replacements so that in a short time Olympic will have one of the most modern aircraft fleets in the world.

The independent international private company Spectrum Capital did the financial evaluation of the proposals. As a result, was chosen the solution of leasing new aircraft and selling the old ones by GECAS Company.

The legality of all procedures of the Board of Directors were checked in advance by the Legal Council which unanimously declared that: `It is not necessary to follow the procedures of the company`s purchase regulations because this case is a legally acceptable revision of the existing contract with Boeing`. Olympic is relieved of the undesirable consequences of paying interest on US $ 60 million, an amount which was due to be paid, on March 1998.

  • Ten year leasing of 15 new aircraft Boeing New Generation (11 B737-700 and 4 B737-800). The first aircraft will be delivered in June 2001 and the last in February 2002.
  • Sale of the retired aircraft B 747-200B (4 aircraft and 6 spare engines) and B727-200ADV (2 aircraft and 2 spare engines).
  • Sale and lease (for use until replacement of the 11 B737-700) of 11 B737-200 under retirement due to stricter noise regulation effective from the 1st of April 2002.
  • Disengagement of OA from its contract PA2041 with Boeing and return with interest of the
  • Deposit.


After delivery of the new aircraft, Olympic Airways will have achieved its strategic goal of reducing the number of types of aircraft and engines. Its fleet will consist of one (1) type for long Haul, one (1) type of wide body aircraft and one (1) basic type of B737, with basically two (2) types of engines for all the fleet.

With the full renewal of its fleet, OA achieves:

  • Substantial improvement on the quality of its services.
  • An increase in flights level of reliability.
  • The attraction of a greater number of passengers.
  • An increase in its revenues and a decrease in its operational expenditure (costs).
  • An improvement of its competitiveness.
  • An improvement of its prospects to be the part of a strategic alliance.
  • A beneficial solution to the long existing problem of its contract with Boeing.


Most important of all is that with the approval of this contract for fleet renewal and intextcompany`s assets evaluation, as it is rnnal practice long term opernal leasingadded to its e.

As a result, therea substantial increase in coe.

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Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.

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