flydubai signs $160m aircraft financing deal

Dubai-based low-cost carrier flydubai has announced on Monday the signing of a $160 million (Dh589 mln) aircraft financing deal with Macquarie AirFinance and Dubai Islamic Bank (DIB).

The agreement will cover financing for the first two aircraft that the budget airline received in May. flydubai will receive $60m each from Macquarie and DIB under a five-year financial deal.

Ghaith Al Ghaith, chief executive of flydubai, says they have managed to secure backing from some of the biggest local and international aviation financiers despite being in the early stages of their operation.

When asked if the Dubai budget airline will try to emulate any of the existing budget carriers in Europe and North America, Al Ghaith says they are trying to find their own niche in the market.

“We are trying to find our own niche and provide services that will fit our target customers. From the very start, we have always said that flydubai is an entity separate from Emirates. We want to be a separate company with its own system,” he told reporters.

flydubai, like its full-service cousin Emirates, was set up by the Dubai government. It launched commercial service in June this year with a start-up capital of Dh250m and currently flies to nine destinations within the Middle East and North African region.

Meanwhile, flydubai has also entered into an agreement that makes Goodrich Corporation its official supplier of wheels and carbon brakes for the 54 Boeing 737-800 aircraft in its fleet.

The deal is expected to generate around $22m in revenue over a 10-year period. Aircraft deliveries with the Goodrich wheel and brake equipment will begin in March next year and continue through 2013.