Air Berlin Cancels $5 Bln Worth Boeing Aircraft Order

(RTTNews) - Air Berlin Plc. (AIBEF.PK), Germany's second-largest airline, said it cancelled an order for 33 Boeing Co. (BA) aircraft worth about $5 billion at list prices. It noted that the cancellation agreement does not provide for any obligation of the Air Berlin group to make any compensation payments to Boeing.

The cancellation removes 15 long-range 787 Dreamliners and 18 single-aisle 737 jetliners from Boeing's backlog.

The Air Berlin group said it will adapt the existing fleet to its needs by the acquisition or leasing of suitable aircraft, although at a lower number of aircraft than initially envisaged.

Ulf Hüttmeyer, Chief Financial Officer at airberlin, said, "Not taking on the 33 aircraft ordered will significantly reduce future capital expenditure for airberlin and improve our balance sheet".

Air Berlin has been struggling for years to achieve sustained profitability. The German carrier had reported a turnaround to profit in the second quarter on higher revenues and lower costs.