Egyptian Leisure Airlines to buy Russian Sukhoi jets

 03 Feb 2016 - 0:00

Egyptian Leisure Airlines to buy Russian Sukhoi jets

 

  • Initial deal for up to 10 SSJ-100 passenger planes
  • Could lead to joint venture to restore flights with Russia

 

 

By Lin Noueihed

CAIRO: Privately-owned Egyptian Leisure Airlines agreed a multi-million dollar deal in Cairo on Tuesday to buy four Russian-made passenger jets from Sukhoi Civil Aircraft, with the option of ordering another six, a Sukhoi official said.

The deal includes the possibility of establishing a joint venture between the two companies and a third to restore tourism links between the countries after last year’s downing of a Russian aircraft in the Sinai peninsula, an Egyptian source said.

Evgeny Andrachnikov, senior vice president of Sukhoi Civil Aircraft, said the SSJ-100 planes were expected to be delivered within two years for use on domestic and North African routes.  He declined to put an exact price on the multi-million dollar deal.

“Four firm, six option, that is what we would like to start with,” he told Reuters on the sidelines of a conference in Cairo. “We are discussing different options in terms of our cooperation beyond that but I... would like to concentrate on that deal first.”

Egyptian Trade and Industry Minister Tarek Kabil confirmed the agreement at a news conference but gave no more details.

An Egyptian source told Reuters that the proposed joint venture would operate an airline and tour agency to bring Russian tourists to Egypt, with responsibility for their security.

Moscow stopped all civilian flights to Egypt, a popular destination for Russian tourists, after a Russian airplane crashed in Sinai on Oct 31. Russia said a bomb brought down the flight, for which Islamic State has claimed responsibility.

An Egyptian-led investigation committee has said it has yet to find evidence of foul play.

“The joint venture will restart the tourist business between Russia and Egypt, targeting 1.5 million visitors a year starting in May,” the source said, adding that flights would be scheduled year-round to carry passengers from three Russian airports to the Red Sea.

The source said 45 planes were expected to be purchased over three years, with the first five potentially delivered as soon as April. Sukhoi would operate a maintenance centre in Egypt and arrange training for 150 pilots in the first two years, the source added.

Andrachnikov declined to comment on those details, saying negotiations are still “a work in progress”.

Egypt has struggled to restore growth after the 2011 uprising that ended Hosni Mubarak’s 30-year rule, ushering in an era of political instability and scaring away tourists.

The Russian crash has hit the economy even harder. The tourism minister has estimated that the industry was losing some 2.2 billion Egyptian pounds ($280.97 million) a month.

($1 = 7.8300 Egyptian pounds)

(Additional reporting by Mohamed Zaki; Editing by Michael Georgy and Jan Harvey)

Reuters